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
23, 2013
POPULAR,
INC.
(Exact
name of registrant as specified in its charter)
COMMONWEALTH OF PUERTO
|
001-34084
|
66-0667416
|
(State or other jurisdiction of
|
(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 23, 2013, Popular, Inc. issued a news release announcing its unaudited financial results for the quarter ended September 30, 2013, 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 23, 2013
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 23, 2013 |
By: /s/ Jorge J. García |
Jorge J. García |
||
Senior Vice President and Corporate Comptroller |
Exhibit 99.1
Popular, Inc. Announces Third Quarter Financial Results
SAN JUAN, Puerto Rico--(BUSINESS WIRE)--October 23, 2013--Popular, Inc. (the “Corporation” or “Popular”) (NASDAQ:BPOP) reported net income of $229.1 million for the quarter ended September 30, 2013, compared to net income of $327.5 million for the quarter ended June 30, 2013.
Mr. Richard L. Carrión, Chairman of the Board and Chief Executive Officer, said: “We continue to generate strong revenues from our core businesses with a net interest margin and capital levels above peer averages. Credit metrics continue to improve, reaching new lows despite the sluggish environment on the island. As a result of our strong capital position, improved asset quality and solid financial performance, I am pleased to mention that we have filed an application to repay TARP. While we are hopeful our application will be approved, we cannot speculate on the timing or the conditionality, if any, of an approval.”
Earnings Highlights | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Quarters ended | Nine months ended | ||||||||||||||||||
(Dollars in thousands, except per share information) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | 30-Sep-13 | 30-Sep-12 | ||||||||||||||
Net interest income | $ 354,206 | $ 355,719 | $ 344,439 | $ 1,056,238 | $ 1,025,216 | ||||||||||||||
Provision for loan losses – non-covered loans | 55,230 | 223,908 | 83,589 | 485,438 | 247,846 | ||||||||||||||
Provision for loan losses – covered loans [1] | 17,433 | 25,500 | 22,619 | 60,489 | 78,284 | ||||||||||||||
Net interest income after provision for loan losses | 281,543 | 106,311 | 238,231 | 510,311 | 699,086 | ||||||||||||||
FDIC loss share expense | (14,866 | ) | (3,755 | ) | (6,707 | ) | (44,887 | ) | (19,387 | ) | |||||||||
Other non-interest income [2] | 306,825 | 297,118 | 138,081 | 664,266 | 400,119 | ||||||||||||||
Operating expenses [2] | 326,599 | 309,586 | 307,033 | 969,883 | 964,800 | ||||||||||||||
Income before income tax | 246,903 | 90,088 | 62,572 | 159,807 | 115,018 | ||||||||||||||
Income tax expense (benefit) | 17,768 | (237,380 | ) | 15,384 | (276,489 | ) | (46,317 | ) | |||||||||||
Net income | $ 229,135 | $ 327,468 | $ 47,188 | $ 436,296 | $ 161,335 | ||||||||||||||
Net income applicable to common stock | $ 228,204 | $ 326,537 | $ 46,257 | $ 433,504 | $ 158,543 | ||||||||||||||
Net income per common share - basic | $ 2.22 | $ 3.18 | $ 0.45 | $ 4.22 | $ 1.55 | ||||||||||||||
Net income per common share - diluted | $ 2.22 | $ 3.17 | $ 0.45 | $ 4.21 | $ 1.55 | ||||||||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. | |||||||||||||||||||
[2] During the second quarter of 2013, the Corporation discontinued the elimination of its proportionate ownership share of intercompany transactions with EVERTEC from their respective revenue and expense categories to reflect them as an equity pick-up adjustment in Other Operating Income. This results in a gross up of operating expenses with a corresponding increase in other operating income. The results of operations for all periods presented have been adjusted to reflect this change. | |||||||||||||||||||
Recent significant events
As a result of this transaction, Popular recognized an after-tax gain of approximately $167.8 million during the third quarter of 2013 and received proceeds of approximately $197 million. As of September 30, 2013, Popular’s investment in EVERTEC had a remaining book value of $42.4 million.
The following tables reflect the results of operations for the third and second quarters of 2013, with adjustments to exclude the impact of certain significant events. Adjustments for the third quarter of 2013 include the effect of the gain related to EVERTEC’s SPO. Adjustments for the second quarter of 2013 include: 1) the effect of the bulk sales of NPLs during the second quarter 2) the effect of the gain recorded related to EVERTEC’s IPO during the second quarter, 3) the impact of the Puerto Rico Tax Reform enacted during the second quarter which resulted in an additional expense for gross receipts tax and a net benefit from the increase in the deferred tax asset, offset by an increase in the current tax expense, as the corporate tax rate was changed from 30% to 39% and 4) the adjustment in the tax rate on distributions from EVERTEC from 15% to 4% and an adjustment to the deferred tax liability related to the covered loan portfolio.
Quarter ended | |||||||||||
(Unaudited) | 30-Sep-13 | ||||||||||
(In thousands) |
Actual Results |
Impact of |
Adjusted Results |
||||||||
Net interest income | $ | 354,206 | $ | - | $ | 354,206 | |||||
Provision for loan losses – non-covered loans | 55,230 | - | 55,230 | ||||||||
Provision for loan losses – covered loans [1] | 17,433 | - | 17,433 | ||||||||
Net interest income after provision for loan losses | 281,543 | - | 281,543 | ||||||||
Service charges on deposit accounts and other service fees | 101,680 | - | 101,680 | ||||||||
Mortgage banking activities | 18,896 | - | 18,896 | ||||||||
Net gain (loss) and valuation adjustments on investment securities | - | - | - | ||||||||
Trading account loss | (6,607 | ) | - | (6,607 | ) | ||||||
Net gain on sale of loans, including valuation adjustments on loans held-for-sale | 3,454 | - | 3,454 | ||||||||
Adjustments (expense) to indemnity reserves on loans sold | (2,387 | ) | - | (2,387 | ) | ||||||
FDIC loss share expense | (14,866 | ) | - | (14,866 | ) | ||||||
Other non-interest income | 191,789 | 175,867 | 15,922 | ||||||||
Total non-interest income | 291,959 | 175,867 | 116,092 | ||||||||
Other taxes | 17,749 | - | 17,749 | ||||||||
Professional fees | 72,039 | 250 | 71,789 | ||||||||
OREO expense | 17,175 | - | 17,175 | ||||||||
Other operating expenses | 219,636 | - | 219,636 | ||||||||
Total operating expenses | 326,599 | 250 | 326,349 | ||||||||
Income before income tax | 246,903 | 175,617 | 71,286 | ||||||||
Income tax expense | 17,768 | 7,789 | 9,979 | ||||||||
Net income | $ | 229,135 | $ | 167,828 | $ | 61,307 | |||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. | |||||||||||
Quarter ended | |||||||||||||||||||
(Unaudited) | 30-Jun-13 | ||||||||||||||||||
(In thousands) |
Actual Results |
Impact of Sale |
Impact of |
Income Tax |
Adjusted Results |
||||||||||||||
Net interest income | $ | 355,719 | $ | - | $ | 1,502 | $ | - | $ | 354,217 | |||||||||
Provision for loan losses – non-covered loans | 223,908 | 169,248 | - | - | 54,660 | ||||||||||||||
Provision for loan losses – covered loans [1] | 25,500 | - | - | - | 25,500 | ||||||||||||||
Net interest income after provision for loan losses | 106,311 | (169,248 | ) | 1,502 | - | 274,057 | |||||||||||||
Service charges on deposit accounts and other service fees | 102,819 | - | - | - | 102,819 | ||||||||||||||
Mortgage banking activities | 18,085 | - | - | - | 18,085 | ||||||||||||||
Net gain and valuation adjustments on investment securities | 5,856 | - | 5,856 | - | - | ||||||||||||||
Trading account loss | (4,345 | ) | - | - | - | (4,345 | ) | ||||||||||||
Net gain (loss) on sale of loans, including valuation adjustments on loans held-for-sale | 4,733 | (3,865 | ) | - | - | 8,598 | |||||||||||||
Adjustments (expense) to indemnity reserves on loans sold | (11,632 | ) | (3,047 | ) | - | - | (8,585 | ) | |||||||||||
FDIC loss share expense | (3,755 | ) | - | - | - | (3,755 | ) | ||||||||||||
Other non-interest income | 181,602 | - | 162,091 | - | 19,511 | ||||||||||||||
Total non-interest income | 293,363 | (6,912 | ) | 167,947 | - | 132,328 | |||||||||||||
Other taxes | 15,288 | - | - | 1,656 | 13,632 | ||||||||||||||
Professional fees | 69,964 | - | 856 | - | 69,108 | ||||||||||||||
OREO expense | 5,762 | - | - | - | 5,762 | ||||||||||||||
Other operating expenses | 218,572 | - | - | - | 218,572 | ||||||||||||||
Total operating expenses | 309,586 | - | 856 | 1,656 | 307,074 | ||||||||||||||
Income (loss) before income tax | 90,088 | (176,160 | ) | 168,593 | (1,656 | ) | 99,311 | ||||||||||||
Income tax (benefit) expense | (237,380 | ) | (68,987 | ) | 11,988 | (211,588 | ) | 31,207 | |||||||||||
Net income (loss) | $ | 327,468 | $ | (107,173 | ) | $ | 156,605 | $ | 209,932 | $ | 68,104 | ||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. | |||||||||||||||||||
[2] Represents the impact of the gross receipt tax corresponding to the first quarter 2013, recorded during the second quarter after enactment. | |||||||||||||||||||
[3] Represents the net benefit of $215.6 million for the increase on the net deferred tax asset from the change of the corporate tax rate from 30% to 39%, $7.9 million resulting from the adjustment in tax rate for distributions from EVERTEC from 15% to 4%, offset by an adjustment of $11.9 million on the deferred tax liability related to the covered loans portfolio. | |||||||||||||||||||
Quarters ended | ||||||||||||
(Unaudited) | Adjusted Results Non-GAAP | |||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | Variance | |||||||||
Net interest income | $ | 354,206 | $ | 354,217 | $ | (11 | ) | |||||
Provision for loan losses – non-covered loans | 55,230 | 54,660 | 570 | |||||||||
Provision for loan losses – covered loans [1] | 17,433 | 25,500 | (8,067 | ) | ||||||||
Net interest income after provision for loan losses | 281,543 | 274,057 | 7,486 | |||||||||
Service charges on deposit accounts and other service fees | 101,680 | 102,819 | (1,139 | ) | ||||||||
Mortgage banking activities | 18,896 | 18,085 | 811 | |||||||||
Net gain and valuation adjustments on investment securities | - | - | - | |||||||||
Trading account loss | (6,607 | ) | (4,345 | ) | (2,262 | ) | ||||||
Net gain on sale of loans, including valuation adjustments on loans held-for-sale | 3,454 | 8,598 | (5,144 | ) | ||||||||
Adjustments (expense) to indemnity reserves on loans sold | (2,387 | ) | (8,585 | ) | 6,198 | |||||||
FDIC loss share expense | (14,866 | ) | (3,755 | ) | (11,111 | ) | ||||||
Other non-interest income | 15,922 | 19,511 | (3,589 | ) | ||||||||
Total non-interest income | 116,092 | 132,328 | (16,236 | ) | ||||||||
Other taxes | 17,749 | 13,632 | 4,117 | |||||||||
Professional fees | 71,789 | 69,108 | 2,681 | |||||||||
OREO expense | 17,175 | 5,762 | 11,413 | |||||||||
Other operating expenses | 219,636 | 218,572 | 1,064 | |||||||||
Total operating expenses | 326,349 | 307,074 | 19,275 | |||||||||
Income before income tax | 71,286 | 99,311 | (28,025 | ) | ||||||||
Income tax expense | 9,979 | 31,207 | (21,228 | ) | ||||||||
Net income | $ | 61,307 | $ | 68,104 | $ | (6,797 | ) | |||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. | ||||||||||||
Net interest income
Net interest margin for the third quarter of 2013 increased three basis points to 4.49% when compared with the second quarter of 2013. Net interest income for the quarter was $354.2 million, decreasing slightly by $1.5 million from the previous quarter. During the third quarter the Corporation reversed interest income of approximately $5.9 million related to a portion of a portfolio of reverse mortgages at BPPR for which interest had been accrued in excess of the amount insured by FHA. Excluding the impact of this adjustment, the net interest margin would have been 4.56%. The main drivers of the increase in the adjusted net interest margin are:
These positive variances were partially offset by:
Non-interest income
Non-interest income decreased by $1.4 million compared with the second quarter of 2013. Excluding the impact of the previously outlined significant events, non-interest income decreased by $16.2 million compared with the second quarter of 2013, driven primarily by the following items:
These decreases were partially offset by:
Refer to table B for further details.
Financial Impact of FDIC-Assisted Transaction | ||||||||||||
(Unaudited) | Quarters ended | |||||||||||
(In thousands) |
30-Sep-13 | 30-Jun-13 | 30-Sep-12 | |||||||||
Income Statement |
||||||||||||
Interest income on covered loans | $ | 71,631 | $ | 70,136 | $ | 70,584 | ||||||
Total FDIC loss share (expense) income | (14,866 | ) | (3,755 | ) | (6,707 | ) | ||||||
Other non-interest income | 109 | 242 | 310 | |||||||||
Provision for loan losses | 17,433 | 25,500 | 22,619 | |||||||||
Total revenues less provision for loan losses | $ | 39,441 | $ | 41,123 | $ | 41,568 | ||||||
Balance Sheet |
||||||||||||
Loans covered under loss-sharing agreements with FDIC | $ | 3,076,009 | $ | 3,199,998 | $ | 3,903,867 | ||||||
FDIC loss share asset | 1,324,711 | 1,379,342 | 1,559,057 | |||||||||
FDIC true-up payment obligation | 124,092 | 118,770 | 103,189 | |||||||||
See additional details on accounting for FDIC-Assisted transaction in Table O.
Operating expenses
Operating expenses increased by $17.0 million when compared with the second quarter of 2013. Excluding the impact of the significant events previously outlined, operating expenses increased by $19.3 million versus the second quarter of 2013, driven primarily by:
These increases were partially offset by:
Non-personnel credit-related costs, which include collections, appraisals, credit related fees, and OREO expenses, amounted to $25.2 million for the third quarter of 2013, compared with $14.6 million for the second quarter of 2013. The increase was principally due to the increase in covered OREO expenses mentioned above, partially offset by a decrease in appraisals and collection costs by $0.8 million.
Full-time equivalent employees (“FTEs”) were 8,094 as of September 30, 2013, compared with 8,117 as of June 30, 2013, and 8,074 as of September 30, 2012. The decrease of 23 FTEs from the second quarter of 2013 is mainly related to the operations of Tranred Venezuela which were sold during this quarter.
For a breakdown of operating expenses by category refer to table B.
Income taxes
Excluding the effect of the sale of EVERTEC shares discussed above, the income tax expense amounted to approximately $10.0 million compared to $31.2 million for the second quarter. During the third quarter, the Corporation recorded a favorable adjustment of approximately $7.7 million in connection with filing its tax returns for the year 2012 during the quarter, mainly related to the distributions received from EVERTEC. The Corporation reclassified $3.3 million of income tax credit related to the gross receipt tax enacted earlier in the year from the operating expenses line to income taxes. Also, the Corporation reversed approximately $7.7 million for uncertain tax positions due to the expiration of the statute of limitations in the Puerto Rico operations. Excluding these adjustments, the income tax expense would have been $28.7 million, for an effective tax rate of approximately 40%.
Credit Quality
The following table presents non-performing assets information:
Non-Performing Assets | ||||||||||||
(Unaudited) | ||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | |||||||||
Total non-performing loans held-in-portfolio, excluding covered loans | $ | 617,573 | $ | 613,867 | $ | 1,550,500 | ||||||
Non-performing loans held-for-sale | 2,099 | 10,697 | 108,886 | |||||||||
Other real estate owned (“OREO”), excluding covered OREO | 135,502 | 158,920 | 252,024 | |||||||||
Total non-performing assets, excluding covered assets | 755,174 | 783,484 | 1,911,410 | |||||||||
Covered loans and OREO | 188,353 | 208,993 | 208,235 | |||||||||
Total non-performing assets | $ | 943,527 | $ | 992,477 | $ | 2,119,645 | ||||||
Net charge-offs for the quarter (excluding covered loans)[1] | $ | 57,892 | $ | 79,145 | $ | 95,791 | ||||||
[1] Excludes write-downs of $199,502 of loans sold during the quarter ended June 30, 2013. | ||||||||||||
Ratios (excluding covered loans): | ||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | 2.88 | % | 2.85 | % | 7.47 | % | ||||||
Allowance for loan losses to loans held-in-portfolio | 2.46 | 2.46 | 3.07 | |||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale | 85.19 | 86.14 | 41.04 | |||||||||
Provision for Loan Losses | ||||||||||||||||||
(Unaudited) | Quarters ended | |||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | |||||||||||||||
Provision (reversal) for loan losses - non-covered loans: | ||||||||||||||||||
BPPR | $ | 50,475 | $ | 230,464 | $ | 69,738 | ||||||||||||
BPNA | 4,755 | (6,556 | ) | 13,851 | ||||||||||||||
Total provision for loan losses - non-covered loans | 55,230 | 223,908 | 83,589 | |||||||||||||||
Provision for loan losses - covered loans | 17,433 | 25,500 | 22,619 | |||||||||||||||
Total provision for loan losses | $ | 72,663 | $ | 249,408 | $ | 106,208 | ||||||||||||
While continuing to operate in a challenging economic environment, overall asset quality continued to improve during the third quarter of 2013, as non-performing assets and net charge-offs were at their lowest in over five years. This steady progress is reflective of the Corporation’s efforts to reduce its high risk assets and improve the risk profile of its portfolios. The following presents credit quality performance for the third quarter of 2013 for the Corporation’s non-covered portfolio.
BPPR Segment
BPNA Segment
Financial Condition Highlights | |||||||||||||
(Unaudited) | |||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | ||||||||||
Total loans held-in-portfolio (net) | $ | 23,860,264 | $ | 24,086,438 | $ | 23,896,548 | |||||||
Total assets | 36,052,116 | 36,684,594 | 36,503,366 | ||||||||||
Deposits | 26,395,054 | 26,759,428 | 26,319,499 | ||||||||||
Borrowings | 4,164,104 | 4,694,671 | 5,017,141 | ||||||||||
Total liabilities | 31,658,231 | 32,489,558 | 32,434,382 | ||||||||||
Stockholders’ equity | 4,393,885 | 4,195,036 | 4,068,984 | ||||||||||
Total assets decreased by approximately $632.5 million from June 30, 2013 driven by:
Total liabilities decreased by $831.3 million from June 30, 2013, driven by:
These decreases were partially offset by:
Stockholders’ equity increased by $198.8 million from June 30, 2013, mainly as a result of the net income for the quarter of $229.1 million, offset by a change of $29.5 million from net unrealized gains to net unrealized losses on investment securities available-for-sale. Refer to Table A for capital ratios.
Refer to Table C for the Statements of Financial Condition.
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 and the impact of proposed capital standards on our capital ratios; (v) the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act on our businesses, business practices and cost of operations; (vi) regulatory approvals that may be necessary to undertake certain actions or consummate strategic transactions such as acquisitions and dispositions; (vii) 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; (viii) the performance of the stock and bond markets; (ix) competition in the financial services industry; (x) additional Federal Deposit Insurance Corporation assessments; and (xi) possible legislative, tax or regulatory changes. 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, 2012, 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, doing business as Popular Community Bank, 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 today Wednesday, October 23, 2013 at 10:00 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 877-515-3183 or 857-244-7326. The conference code is 27118445.
A replay of the webcast will be archived in Popular’s website. A telephone replay will be available from 12:00 p.m. on Wednesday, October 23, 2013 to 11:59 p.m. on Wednesday, October 30, 2013, at 888-286-8010 or 617-801-6888. The replay passcode is 60477997.
Popular, Inc. |
Financial Supplement to Third Quarter 2013 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 - Mortgage Banking Activities and 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 2013 Earnings Release | ||||||||||||||||||||
Table A - Selected Ratios and Other Information | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||
Quarters ended | Nine months ended | |||||||||||||||||||
30-Sep-13 | 30-Jun-13 | 30-Sep-12 | 30-Sep-13 | 30-Sep-12 | ||||||||||||||||
Net income per common share: | ||||||||||||||||||||
Basic | $ | 2.22 | $ | 3.18 | $ | 0.45 | $ | 4.22 | $ | 1.55 | ||||||||||
Diluted | $ | 2.22 | $ | 3.17 | $ | 0.45 | $ | 4.21 | $ | 1.55 | ||||||||||
Average common shares outstanding | 102,714,262 | 102,620,295 | 102,451,410 | 102,666,570 | 102,363,099 | |||||||||||||||
Average common shares outstanding - assuming dilution | 103,017,443 | 102,917,347 | 102,484,960 | 103,014,674 | 102,545,474 | |||||||||||||||
Common shares outstanding at end of period | 103,327,146 | 103,276,131 | 103,097,143 | 103,327,146 | 103,097,143 | |||||||||||||||
Market value per common share | $ | 26.25 | $ | 30.37 | $ | 17.45 | $ | 26.25 | $ | 17.45 | ||||||||||
Market capitalization - (In millions) | $ | 2,712 | $ | 3,136 | $ | 1,799 | $ | 2,712 | $ | 1,799 | ||||||||||
Return on average assets | 2.51 | % | 3.60 | % | 0.52 | % | 1.60 | % | 0.59 | % | ||||||||||
Return on average common equity | 21.64 | % | 32.77 | % | 4.81 | % | 14.38 | % | 5.63 | % | ||||||||||
Net interest margin [2] | 4.49 | % | 4.46 | % | 4.38 | % | 4.45 | % | 4.33 | % | ||||||||||
Common equity per share | $ | 42.04 | $ | 40.13 | $ | 38.98 | $ | 42.04 | $ | 38.98 | ||||||||||
Tangible common book value per common share (non-GAAP) [1] | $ | 35.32 | $ | 33.38 | $ | 32.15 | $ | 35.32 | $ | 32.15 | ||||||||||
Tangible common equity to tangible assets (non-GAAP) [1] | 10.32 | % | 9.58 | % | 9.26 | % | 10.32 | % | 9.26 | % | ||||||||||
Tier 1 risk-based capital [3] | 18.54 | % | 17.30 | % | 16.81 | % | 18.54 | % | 16.81 | % | ||||||||||
Total risk-based capital [3] | 19.82 | % | 18.58 | % | 18.09 | % | 19.82 | % | 18.09 | % | ||||||||||
Tier 1 leverage [3] | 12.26 | % | 11.46 | % | 11.40 | % | 12.26 | % | 11.40 | % | ||||||||||
Tier 1 common equity to risk-weighted assets (non-GAAP) [1] [3] | 14.20 | % | 13.04 | % | 12.72 | % | 14.20 | % | 12.72 | % | ||||||||||
[1] Refer to Table N for Non-GAAP reconciliations. | ||||||||||||||||||||
[2] Not on a taxable equivalent basis. | ||||||||||||||||||||
[3] Capital ratios for the current quarter are estimated. | ||||||||||||||||||||
POPULAR, INC. | |||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | |||||||||||||||||||||||||||||
Table B - Consolidated Statement of Operations | |||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||
Quarters ended | Variance | Quarter ended | Variance | Nine months ended | |||||||||||||||||||||||||
(In thousands, except per share information) | 30-Sep-13 | 30-Jun-13 |
Q3 2013 |
30-Sep-12 |
Q3 2013 |
30-Sep-13 | 30-Sep-12 | ||||||||||||||||||||||
Interest income: | |||||||||||||||||||||||||||||
Loans | $ | 392,195 | $ | 394,925 | $ | (2,730 | ) | $ | 387,949 | $ | 4,246 | $ | 1,173,046 | $ | 1,166,393 | ||||||||||||||
Money market investments | 848 | 829 | 19 | 862 | (14 | ) | 2,632 | 2,774 | |||||||||||||||||||||
Investment securities | 33,561 | 36,106 | (2,545 | ) | 40,412 | (6,851 | ) | 107,490 | 130,212 | ||||||||||||||||||||
Trading account securities | 5,242 | 5,456 | (214 | ) | 5,815 | (573 | ) | 16,212 | 17,669 | ||||||||||||||||||||
Total interest income | 431,846 | 437,316 | (5,470 | ) | 435,038 | (3,192 | ) | 1,299,380 | 1,317,048 | ||||||||||||||||||||
Interest expense: | |||||||||||||||||||||||||||||
Deposits | 31,848 | 35,764 | (3,916 | ) | 43,022 | (11,174 | ) | 105,968 | 143,297 | ||||||||||||||||||||
Short-term borrowings | 9,564 | 9,767 | (203 | ) | 9,876 | (312 | ) | 29,113 | 36,503 | ||||||||||||||||||||
Long-term debt | 36,228 | 36,066 | 162 | 37,701 | (1,473 | ) | 108,061 | 112,032 | |||||||||||||||||||||
Total interest expense | 77,640 | 81,597 | (3,957 | ) | 90,599 | (12,959 | ) | 243,142 | 291,832 | ||||||||||||||||||||
Net interest income | 354,206 | 355,719 | (1,513 | ) | 344,439 | 9,767 | 1,056,238 | 1,025,216 | |||||||||||||||||||||
Provision for loan losses - non-covered loans | 55,230 | 223,908 | (168,678 | ) | 83,589 | (28,359 | ) | 485,438 | 247,846 | ||||||||||||||||||||
Provision for loan losses - covered loans | 17,433 | 25,500 | (8,067 | ) | 22,619 | (5,186 | ) | 60,489 | 78,284 | ||||||||||||||||||||
Net interest income after provision for loan losses | 281,543 | 106,311 | 175,232 | 238,231 | 43,312 | 510,311 | 699,086 | ||||||||||||||||||||||
Service charges on deposit accounts | 43,096 | 43,937 | (841 | ) | 45,858 | (2,762 | ) | 130,755 | 138,577 | ||||||||||||||||||||
Other service fees | 58,584 | 58,882 | (298 | ) | 57,954 | 630 | 173,559 | 172,582 | |||||||||||||||||||||
Mortgage banking activities | 18,896 | 18,085 | 811 | 21,847 | (2,951 | ) | 57,281 | 60,418 | |||||||||||||||||||||
Net gain (loss) and valuation adjustments on investment securities | - | 5,856 | (5,856 | ) | 64 | (64 | ) | 5,856 | (285 | ) | |||||||||||||||||||
Trading account (loss) profit | (6,607 | ) | (4,345 | ) | (2,262 | ) | 5,443 | (12,050 | ) | (11,936 | ) | 6,040 | |||||||||||||||||
Net gain (loss) on sale of loans, including valuation adjustments on loans held-for-sale | 3,454 | 4,733 | (1,279 | ) | (1,205 | ) | 4,659 | (54,532 | ) | (30,459 | ) | ||||||||||||||||||
Adjustments (expense) to indemnity reserves on loans sold | (2,387 | ) | (11,632 | ) | 9,245 | (8,717 | ) | 6,330 | (30,162 | ) | (17,990 | ) | |||||||||||||||||
FDIC loss share (expense) income | (14,866 | ) | (3,755 | ) | (11,111 | ) | (6,707 | ) | (8,159 | ) | (44,887 | ) | (19,387 | ) | |||||||||||||||
Other operating income | 191,789 | 181,602 | 10,187 | 16,837 | 174,952 | 393,445 | 71,236 | ||||||||||||||||||||||
Total non-interest income | 291,959 | 293,363 | (1,404 | ) | 131,374 | 160,585 | 619,379 | 380,732 | |||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||||||||
Personnel costs | |||||||||||||||||||||||||||||
Salaries | 76,735 | 74,392 | 2,343 | 74,339 | 2,396 | 224,472 | 227,119 | ||||||||||||||||||||||
Commissions, incentives and other bonuses | 14,457 | 15,540 | (1,083 | ) | 12,800 | 1,657 | 45,472 | 39,885 | |||||||||||||||||||||
Pension, postretirement and medical insurance | 14,724 | 14,748 | (24 | ) | 15,984 | (1,260 | ) | 44,710 | 50,523 | ||||||||||||||||||||
Other personnel costs, including payroll taxes | 10,923 | 9,999 | 924 | 8,427 | 2,496 | 32,853 | 31,850 | ||||||||||||||||||||||
Total personnel costs | 116,839 | 114,679 | 2,160 | 111,550 | 5,289 | 347,507 | 349,377 | ||||||||||||||||||||||
Net occupancy expenses | 24,711 | 24,108 | 603 | 23,615 | 1,096 | 72,292 | 71,143 | ||||||||||||||||||||||
Equipment expenses | 11,768 | 11,843 | (75 | ) | 11,447 | 321 | 35,561 | 33,688 | |||||||||||||||||||||
Other taxes | 17,749 | 15,288 | 2,461 | 12,666 | 5,083 | 44,623 | 38,178 | ||||||||||||||||||||||
Professional fees | 72,039 | 69,964 | 2,075 | 70,952 | 1,087 | 212,500 | 206,692 | ||||||||||||||||||||||
Communications | 6,558 | 6,644 | (86 | ) | 6,500 | 58 | 20,034 | 20,276 | |||||||||||||||||||||
Business promotion | 14,982 | 15,562 | (580 | ) | 14,924 | 58 | 43,461 | 44,754 | |||||||||||||||||||||
FDIC deposit insurance | 16,100 | 19,503 | (3,403 | ) | 24,173 | (8,073 | ) | 44,883 | 72,006 | ||||||||||||||||||||
Loss on early extinguishment of debt | 3,388 | - | 3,388 | 43 | 3,345 | 3,388 | 25,184 | ||||||||||||||||||||||
Other real estate owned (OREO) expenses | 17,175 | 5,762 | 11,413 | 5,896 | 11,279 | 69,678 | 22,441 | ||||||||||||||||||||||
Credit and debit card processing, volume, interchange and other expenses | 5,076 | 5,352 | (276 | ) | 5,442 | (366 | ) | 15,403 | 15,083 | ||||||||||||||||||||
Other operating expenses | 17,746 | 18,414 | (668 | ) | 17,344 | 402 | 53,150 | 58,373 | |||||||||||||||||||||
Amortization of intangibles | 2,468 | 2,467 | 1 | 2,481 | (13 | ) | 7,403 | 7,605 | |||||||||||||||||||||
Total operating expenses | 326,599 | 309,586 | 17,013 | 307,033 | 19,566 | 969,883 | 964,800 | ||||||||||||||||||||||
Income before income tax | 246,903 | 90,088 | 156,815 | 62,572 | 184,331 | 159,807 | 115,018 | ||||||||||||||||||||||
Income tax expense (benefit) | 17,768 | (237,380 | ) | 255,148 | 15,384 | 2,384 | (276,489 | ) | (46,317 | ) | |||||||||||||||||||
Net income | $ | 229,135 | $ | 327,468 | $ | (98,333 | ) | $ | 47,188 | $ | 181,947 | $ | 436,296 | $ | 161,335 | ||||||||||||||
Net income applicable to common stock | $ | 228,204 | $ | 326,537 | $ | (98,333 | ) | $ | 46,257 | $ | 181,947 | $ | 433,504 | $ | 158,543 | ||||||||||||||
Net income per common share - basic | $ | 2.22 | $ | 3.18 | $ | (0.96 | ) | $ | 0.45 | $ | 1.77 | $ | 4.22 | $ | 1.55 | ||||||||||||||
Net income per common share - diluted | $ | 2.22 | $ | 3.17 | $ | (0.95 | ) | $ | 0.45 | $ | 1.77 | $ | 4.21 | $ | 1.55 | ||||||||||||||
Popular, Inc. | ||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | ||||||||||||||||||
Table C - Consolidated Statement of Financial Condition | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Variance | ||||||||||||||||||
Q3 2013 vs. | ||||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | Q2 2013 | ||||||||||||||
Assets: | ||||||||||||||||||
Cash and due from banks | $ | 368,590 | $ | 388,041 | $ | 477,342 | $ | (19,451 | ) | |||||||||
Money market investments | 961,788 | 1,071,939 | 925,663 | (110,151 | ) | |||||||||||||
Trading account securities, at fair value | 338,848 | 294,082 | 226,918 | 44,766 | ||||||||||||||
Investment securities available-for-sale, at fair value | 5,136,618 | 5,114,636 | 5,120,301 | 21,982 | ||||||||||||||
Investment securities held-to-maturity, at amortized cost | 140,355 | 141,632 | 122,072 | (1,277 | ) | |||||||||||||
Other investment securities, at lower of cost or realizable value | 198,864 | 218,582 | 213,389 | (19,718 | ) | |||||||||||||
Loans held-for-sale, at lower of cost or fair value | 124,532 | 190,852 | 337,049 | (66,320 | ) | |||||||||||||
Loans held-in-portfolio: | ||||||||||||||||||
Loans not covered under loss sharing agreements with the FDIC | 21,520,054 | 21,615,754 | 20,851,108 | (95,700 | ) | |||||||||||||
Loans covered under loss sharing agreements with the FDIC | 3,076,009 | 3,199,998 | 3,903,867 | (123,989 | ) | |||||||||||||
Less: Unearned income | 92,871 | 94,095 | 97,255 | (1,224 | ) | |||||||||||||
Allowance for loan losses | 642,928 | 635,219 | 761,172 | 7,709 | ||||||||||||||
Total loans held-in-portfolio, net | 23,860,264 | 24,086,438 | 23,896,548 | (226,174 | ) | |||||||||||||
FDIC loss share asset | 1,324,711 | 1,379,342 | 1,559,057 | (54,631 | ) | |||||||||||||
Premises and equipment, net | 519,623 | 527,014 | 525,733 | (7,391 | ) | |||||||||||||
Other real estate not covered under loss sharing agreements with the FDIC | 135,502 | 158,920 | 252,024 | (23,418 | ) | |||||||||||||
Other real estate covered under loss sharing agreements with the FDIC | 159,968 | 183,225 | 125,514 | (23,257 | ) | |||||||||||||
Accrued income receivable | 122,881 | 143,905 | 133,943 | (21,024 | ) | |||||||||||||
Mortgage servicing assets, at fair value | 161,445 | 153,444 | 158,367 | 8,001 | ||||||||||||||
Other assets | 1,803,478 | 1,935,426 | 1,724,927 | (131,948 | ) | |||||||||||||
Goodwill | 647,757 | 647,757 | 647,757 | - | ||||||||||||||
Other intangible assets | 46,892 | 49,359 | 56,762 | (2,467 | ) | |||||||||||||
Total assets | $ | 36,052,116 | $ | 36,684,594 | $ | 36,503,366 | $ | (632,478 | ) | |||||||||
Liabilities and Stockholders’ Equity: | ||||||||||||||||||
Liabilities: | ||||||||||||||||||
Deposits: | ||||||||||||||||||
Non-interest bearing | $ | 5,762,554 | $ | 5,856,066 | $ | 5,404,470 | $ | (93,512 | ) | |||||||||
Interest bearing | 20,632,500 | 20,903,362 | 20,915,029 | (270,862 | ) | |||||||||||||
Total deposits | 26,395,054 | 26,759,428 | 26,319,499 | (364,374 | ) | |||||||||||||
Federal funds purchased and assets sold under agreements to repurchase | 1,793,208 | 1,672,705 | 1,944,564 | 120,503 | ||||||||||||||
Other short-term borrowings | 826,200 | 1,226,200 | 1,206,200 | (400,000 | ) | |||||||||||||
Notes payable | 1,544,696 | 1,795,766 | 1,866,377 | (251,070 | ) | |||||||||||||
Other liabilities | 1,099,073 | 1,035,459 | 1,097,742 | 63,614 | ||||||||||||||
Total liabilities | 31,658,231 | 32,489,558 | 32,434,382 | (831,327 | ) | |||||||||||||
Stockholders’ equity: | ||||||||||||||||||
Preferred stock | 50,160 | 50,160 | 50,160 | - | ||||||||||||||
Common stock | 1,034 | 1,033 | 1,031 | 1 | ||||||||||||||
Surplus | 4,155,244 | 4,153,525 | 4,131,681 | 1,719 | ||||||||||||||
Retained earnings | 445,330 | 217,126 | (54,183 | ) | 228,204 | |||||||||||||
Treasury stock | (877 | ) | (769 | ) | (270 | ) | (108 | ) | ||||||||||
Accumulated other comprehensive loss | (257,006 | ) | (226,039 | ) | (59,435 | ) | (30,967 | ) | ||||||||||
Total stockholders’ equity | 4,393,885 | 4,195,036 | 4,068,984 | 198,849 | ||||||||||||||
Total liabilities and stockholders’ equity | $ | 36,052,116 | $ | 36,684,594 | $ | 36,503,366 | $ | (632,478 | ) | |||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 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) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | Q3 2013 vs. Q2 2013 | Q3 2013 vs. Q3 2012 | |||||||||||||||||||||||||||||||||||||||||
Average balance |
Income/ Expense |
Yield/ Rate |
Average balance |
Income/ Expense |
Yield/ Rate |
Average balance |
Income/ Expense |
Yield/ Rate |
Average balance |
Income/ Expense |
Yield/ Rate |
Average balance |
Income/ Expense |
Yield/ Rate |
||||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||||||||||||||||||||||||
Money market, trading and investment securities | $6,813 | $39.7 | 2.32 | % | $6,943 | $42.4 | 2.44 | % | $6,625 | $47.1 | 2.84 | % | ($130 | ) | ($2.7 | ) | (0.12 | ) | % | $188 | ($7.4 | ) | (0.52 | ) | % | |||||||||||||||||||||
Loans not covered under loss sharing agreements with the FDIC: | ||||||||||||||||||||||||||||||||||||||||||||||
Commercial | 10,107 | 126.0 | 4.95 | 10,022 | 122.8 | 4.91 | 10,024 | 123.7 | 4.91 | 85 | 3.2 | 0.04 | 83 | 2.3 | 0.04 | |||||||||||||||||||||||||||||||
Construction | 319 | 4.3 | 5.30 | 316 | 3.6 | 4.62 | 435 | 3.3 | 3.02 | 3 | 0.7 | 0.68 | (116 | ) | 1.0 | 2.28 | ||||||||||||||||||||||||||||||
Mortgage | 6,633 | 81.7 | 4.93 | 7,019 | 91.2 | 5.20 | 5,915 | 80.7 | 5.46 | (386 | ) | (9.5 | ) | (0.27 | ) | 718 | 1.0 | (0.53 | ) | |||||||||||||||||||||||||||
Consumer | 3,906 | 97.6 | 9.91 | 3,849 | 96.3 | 10.03 | 3,855 | 97.9 | 10.10 | 57 | 1.3 | (0.12 | ) | 51 | (0.3 | ) | (0.19 | ) | ||||||||||||||||||||||||||||
Lease financing | 537 | 10.9 | 8.08 | 542 | 10.9 | 8.02 | 540 | 11.7 | 8.67 | (5 | ) | - | 0.06 | (3 | ) | (0.8 | ) | (0.59 | ) | |||||||||||||||||||||||||||
Total loans not covered under loss sharing agreements with the FDIC | 21,502 | 320.5 | 5.93 | 21,748 | 324.8 | 5.98 | 20,769 | 317.3 | 6.09 | (246 | ) | (4.3 | ) | (0.05 | ) | 733 | 3.2 | (0.16 | ) | |||||||||||||||||||||||||||
Loans covered under loss sharing agreements with the FDIC | 3,119 | 71.6 | 9.13 | 3,269 | 70.1 | 8.60 | 3,952 | 70.6 | 7.12 | (150 | ) | 1.5 | 0.53 | (833 | ) | 1.0 | 2.01 | |||||||||||||||||||||||||||||
Total loans | 24,621 | 392.1 | 6.33 | 25,017 | 394.9 | 6.33 | 24,721 | 387.9 | 6.25 | (396 | ) | (2.8 | ) | - | (100 | ) | 4.2 | 0.08 | ||||||||||||||||||||||||||||
Total interest earning assets | 31,434 | $431.8 | 5.47 | % | 31,960 | $437.3 | 5.48 | % | 31,346 | $435.0 | 5.53 | % | (526 | ) | ($5.5 | ) | (0.01 | ) | % | 88 | ($3.2 | ) | (0.06 | ) | % | |||||||||||||||||||||
Allowance for loan losses | (632 | ) | (673 | ) | (757 | ) | 41 | 125 | ||||||||||||||||||||||||||||||||||||||
Other non-interest earning assets | 5,372 | 5,215 | 5,396 | 157 | (24 | ) | ||||||||||||||||||||||||||||||||||||||||
Total average assets | $36,174 | $36,502 | $35,985 | ($328 | ) | $189 | ||||||||||||||||||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||||||||||||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||||||||||||||||||||||||
NOW and money market | $5,766 | $4.1 | 0.29 | % | $5,838 | $5.2 | 0.36 | % | $5,709 | $6.2 | 0.43 | % | ($72 | ) | ($1.1 | ) | (0.07 | ) | % | $57 | ($2.1 | ) | (0.14 | ) | % | |||||||||||||||||||||
Savings | 6,828 | 3.7 | 0.21 | 6,748 | 4.2 | 0.25 | 6,561 | 4.5 | 0.27 | 80 | (0.5 | ) | (0.04 | ) | 267 | (0.8 | ) | (0.06 | ) | |||||||||||||||||||||||||||
Time deposits | 8,231 | 24.0 | 1.16 | 8,619 | 26.4 | 1.23 | 9,003 | 32.3 | 1.43 | (388 | ) | (2.4 | ) | (0.07 | ) | (772 | ) | (8.3 | ) | (0.27 | ) | |||||||||||||||||||||||||
Total interest bearing deposits | 20,825 | 31.8 | 0.61 | 21,205 | 35.8 | 0.68 | 21,273 | 43.0 | 0.80 | (380 | ) | (4.0 | ) | (0.07 | ) | (448 | ) | (11.2 | ) | (0.19 | ) | |||||||||||||||||||||||||
Borrowings | 4,404 | 45.8 | 4.15 | 4,488 | 45.8 | 4.09 | 4,426 | 47.6 | 4.29 | (84 | ) | - | 0.06 | (22 | ) | (1.8 | ) | (0.14 | ) | |||||||||||||||||||||||||||
Total interest bearing liabilities | 25,229 | 77.6 | 1.23 | 25,693 | 81.6 | 1.27 | 25,699 | 90.6 | 1.41 | (464 | ) | (4.0 | ) | (0.04 | ) | (470 | ) | (13.0 | ) | (0.18 | ) | |||||||||||||||||||||||||
Net interest spread | 4.24 | % | 4.21 | % | 4.12 | % | 0.03 |
% |
|
0.12 |
% |
|
||||||||||||||||||||||||||||||||||
Non-interest bearing deposits | 5,741 | 5,749 | 5,319 | (8 | ) | 422 | ||||||||||||||||||||||||||||||||||||||||
Other liabilities | 969 | 1,013 | 1,091 | (44 | ) | (122 | ) | |||||||||||||||||||||||||||||||||||||||
Stockholders' equity | 4,235 | 4,047 | 3,876 | 188 | 359 | |||||||||||||||||||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $36,174 | $36,502 | $35,985 | ($328 | ) | $189 | ||||||||||||||||||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $354.2 | 4.49 | % | $355.7 | 4.46 | % | $344.4 | 4.38 | % | ($1.5 | ) | 0.03 |
% |
|
$9.8 | 0.11 |
% |
|
||||||||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | ||||||||||||||||||||||||||||
Table E - Consolidated Average Balances and Yield / Rate Analysis - YEAR-TO-DATE | ||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
Nine months ended | Nine months ended | |||||||||||||||||||||||||||
30-Sep-13 | 30-Sep-12 | Variance | ||||||||||||||||||||||||||
($ amounts in millions; yields not on a |
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 | $6,908 | $126.3 | 2.44 | % | $6,735 | $150.7 | 2.98 | % | $173 | ($24.4 | ) | (0.54 | ) | % | ||||||||||||||
Loans not covered under loss sharing agreements with the FDIC: | ||||||||||||||||||||||||||||
Commercial | 10,070 | 368.7 | 4.90 | 10,234 | 377.6 | 4.93 | (164 | ) | (8.9 | ) | (0.03 | ) | ||||||||||||||||
Construction | 334 | 11.5 | 4.58 | 484 | 13.3 | 3.66 | (150 | ) | (1.8 | ) | 0.92 | |||||||||||||||||
Mortgage | 6,688 | 256.2 | 5.11 | 5,698 | 233.9 | 5.47 | 990 | 22.3 | (0.36 | ) | ||||||||||||||||||
Consumer | 3,870 | 289.6 | 10.01 | 3,719 | 281.6 | 10.11 | 151 | 8.0 | (0.10 | ) | ||||||||||||||||||
Lease financing | 541 | 33.1 | 8.16 | 547 | 35.5 | 8.66 | (6 | ) | (2.4 | ) | (0.50 | ) | ||||||||||||||||
Total loans not covered under loss sharing agreements with the FDIC | 21,503 | 959.1 | 5.96 | 20,682 | 941.9 | 6.08 | 821 | 17.2 | (0.12 | ) | ||||||||||||||||||
Loans covered under loss sharing agreements with the FDIC | 3,299 | 214.0 | 8.67 | 4,124 | 224.4 | 7.27 | (825 | ) | (10.4 | ) | 1.40 | |||||||||||||||||
Total loans | 24,802 | 1,173.1 | 6.32 | 24,806 | 1,166.3 | 6.28 | (4 | ) | 6.8 | 0.04 | ||||||||||||||||||
Total interest earning assets | 31,710 | $1,299.4 | 5.47 | % | 31,541 | $1,317.0 | 5.57 | % | 169 | ($17.6 | ) | (0.10 | ) | % | ||||||||||||||
Allowance for loan losses | (654 | ) | (779 | ) | 125 | |||||||||||||||||||||||
Other non-interest earning assets | 5,289 | 5,490 | (201 | ) | ||||||||||||||||||||||||
Total average assets | $36,345 | $36,252 | $93 | |||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||||||
NOW and money market | $5,767 | $15.2 | 0.35 | % | $5,504 | $18.5 | 0.45 | % | $263 | ($3.3 | ) | (0.10 | ) | % | ||||||||||||||
Savings | 6,765 | 12.2 | 0.24 | 6,543 | 17.0 | 0.35 | 222 | (4.8 | ) | (0.11 | ) | |||||||||||||||||
Time deposits | 8,559 | 78.6 | 1.23 | 9,680 | 107.8 | 1.49 | (1,121 | ) | (29.2 | ) | (0.26 | ) | ||||||||||||||||
Total interest bearing deposits | 21,091 | 106.0 | 0.67 | 21,727 | 143.3 | 0.88 | (636 | ) | (37.3 | ) | (0.21 | ) | ||||||||||||||||
Borrowings | 4,461 | 137.2 | 4.10 | 4,319 | 148.5 | 4.59 | 142 | (11.3 | ) | (0.49 | ) | |||||||||||||||||
Total interest bearing liabilities | 25,552 | 243.2 | 1.27 | 26,046 | 291.8 | 1.50 | (494 | ) | (48.6 | ) | (0.23 | ) | ||||||||||||||||
Net interest spread | 4.20 | % | 4.07 | % | 0.13 | % | ||||||||||||||||||||||
Non-interest bearing deposits | 5,694 | 5,281 | 413 | |||||||||||||||||||||||||
Other liabilities | 1,018 | 1,113 | (95 | ) | ||||||||||||||||||||||||
Stockholders' equity | 4,081 | 3,812 | 269 | |||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $36,345 | $36,252 | $93 | |||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $1,056.2 | 4.45 | % | $1,025.2 | 4.33 | % | $31.0 | 0.12 | % | |||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | |||||||||||||||||||||||||||||||||
Table F - Mortgage Banking Activities and Other Service Fees | |||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||
Mortgage Banking Activities | Variance | ||||||||||||||||||||||||||||||||
Quarters ended | Q3 2013 vs. | Q3 2013 vs. | Nine months ended | Variance | |||||||||||||||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | Q2 2013 | Q3 2012 | 30-Sep-13 | 30-Sep-12 | 2013 vs. 2012 | |||||||||||||||||||||||||
Mortgage servicing fees, net of fair value adjustments: | |||||||||||||||||||||||||||||||||
Mortgage servicing fees | $ | 11,547 | $ | 11,317 | $ | 12,282 | $ | 230 | $ | (735 | ) | $ | 34,110 | $ | 36,339 | $ | (2,229 | ) | |||||||||||||||
Mortgage servicing rights fair value adjustments | 3,879 | (5,126 | ) | (2,426 | ) | 9,005 | 6,305 | (6,862 | ) | (7,217 | ) | 355 | |||||||||||||||||||||
Total mortgage servicing fees, net of fair value adjustments | 15,426 | 6,191 | 9,856 | 9,235 | 5,570 | 27,248 | 29,122 | (1,874 | ) | ||||||||||||||||||||||||
Net gain (loss) on sale of loans, including valuation on loans | 3,559 | (351 | ) | 19,700 | 3,910 | (16,141 | ) | 16,968 | 49,028 | (32,060 | ) | ||||||||||||||||||||||
Trading account profit (loss): | |||||||||||||||||||||||||||||||||
Unrealized gain (losses) on outstanding derivative positions | (865 | ) | 622 | (58 | ) | (1,487 | ) | (807 | ) | (265 | ) | (154 | ) | (111 | ) | ||||||||||||||||||
Realized gain (losses) on closed derivative positions | 776 | 11,623 | (7,651 | ) | (10,847 | ) | 8,427 | 13,330 | (17,578 | ) | 30,908 | ||||||||||||||||||||||
Total trading account (loss) profit | (89 | ) | 12,245 | (7,709 | ) | (12,334 | ) | 7,620 | 13,065 | (17,732 | ) | 30,797 | |||||||||||||||||||||
Total mortgage banking activities | $ | 18,896 | $ | 18,085 | $ | 21,847 | $ | 811 | $ | (2,951 | ) | $ | 57,281 | $ | 60,418 | $ | (3,137 | ) | |||||||||||||||
Other Service Fees | Variance | ||||||||||||||||||||||||||||||||
Quarters ended | Q3 2013 vs. | Q3 2013 vs. | Nine months ended | Variance | |||||||||||||||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | Q2 2013 | Q3 2012 | 30-Sep-13 | 30-Sep-12 | 2013 vs. 2012 | |||||||||||||||||||||||||
Other service fees: | |||||||||||||||||||||||||||||||||
Debit card fees | $ | 11,005 | $ | 10,736 | $ | 10,752 | $ | 269 | $ | 253 | $ | 32,138 | $ | 33,223 | $ | (1,085 | ) | ||||||||||||||||
Insurance fees | 13,255 | 12,465 | 12,322 | 790 | 933 | 37,793 | 36,775 | 1,018 | |||||||||||||||||||||||||
Credit card fees | 16,890 | 16,406 | 15,623 | 484 | 1,267 | 48,981 | 44,383 | 4,598 | |||||||||||||||||||||||||
Sale and administration of investment products | 8,981 | 10,243 | 9,511 | (1,262 | ) | (530 | ) | 27,941 | 28,045 | (104 | ) | ||||||||||||||||||||||
Trust fees | 4,148 | 4,154 | 3,977 | (6 | ) | 171 | 12,760 | 12,127 | 633 | ||||||||||||||||||||||||
Processing fees | - | - | 1,406 | - | (1,406 | ) | - | 4,819 | (4,819 | ) | |||||||||||||||||||||||
Other fees | 4,305 | 4,878 | 4,363 | (573 | ) | (58 | ) | 13,946 | 13,210 | 736 | |||||||||||||||||||||||
Total other service fees | $ | 58,584 | $ | 58,882 | $ | 57,954 | $ | (298 | ) | $ | 630 | $ | 173,559 | $ | 172,582 | $ | 977 | ||||||||||||||||
Popular, Inc. | |||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | |||||||||||||||||
Table G - Loans and Deposits | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Loans - Ending Balances | |||||||||||||||||
Variance | |||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 |
Q3 2013 vs. |
Q3 2013 vs. |
||||||||||||
Loans not covered under FDIC loss sharing agreements: | |||||||||||||||||
Commercial | $ | 9,845,477 | $ | 9,917,840 | $ | 9,628,631 | $ | (72,363 | ) | $ | 216,846 | ||||||
Construction | 293,220 | 297,010 | 258,453 | (3,790 | ) | 34,767 | |||||||||||
Legacy [1] | 235,645 | 262,228 | 465,848 | (26,583 | ) | (230,203 | ) | ||||||||||
Lease financing | 539,290 | 538,348 | 538,014 | 942 | 1,276 | ||||||||||||
Mortgage | 6,613,133 | 6,603,587 | 6,022,422 | 9,546 | 590,711 | ||||||||||||
Consumer | 3,900,418 | 3,902,646 | 3,840,485 | (2,228 | ) | 59,933 | |||||||||||
Total non-covered loans held-in-portfolio | $ | 21,427,183 | $ | 21,521,659 | $ | 20,753,853 | $ | (94,476 | ) | $ | 673,330 | ||||||
Loans covered under FDIC loss sharing agreements | 3,076,009 | 3,199,998 | 3,903,867 | (123,989 | ) | (827,858 | ) | ||||||||||
Total loans held-in-portfolio | $ | 24,503,192 | $ | 24,721,657 | $ | 24,657,720 | $ | (218,465 | ) | $ | (154,528 | ) | |||||
Loans held-for-sale: | |||||||||||||||||
Commercial | $ | - | $ | 2,594 | $ | 17,696 | $ | (2,594 | ) | $ | (17,696 | ) | |||||
Construction | - | - | 88,030 | - | (88,030 | ) | |||||||||||
Legacy [1] | 1,680 | 1,680 | 3,107 | - | (1,427 | ) | |||||||||||
Mortgage | 122,852 | 186,578 | 228,216 | (63,726 | ) | (105,364 | ) | ||||||||||
Total loans held-for-sale | $ | 124,532 | $ | 190,852 | $ | 337,049 | $ | (66,320 | ) | $ | (212,517 | ) | |||||
Total loans | $ | 24,627,724 | $ | 24,912,509 | $ | 24,994,769 | $ | (284,785 | ) | $ | (367,045 | ) | |||||
[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 segment. | |||||||||||||||||
Deposits - Ending Balances | |||||||||||||||||
Variance | |||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 |
Q3 2013 vs. |
Q3 2013 vs. |
||||||||||||
Demand deposits [1] | $ | 6,410,458 | $ | 6,655,895 | $ | 6,091,400 | $ | (245,437 | ) | $ | 319,058 | ||||||
Savings, NOW and money market deposits (non-brokered) | 11,335,441 | 11,253,707 | 11,046,595 | 81,734 | 288,846 | ||||||||||||
Savings, NOW and money market deposits (brokered) | 552,053 | 509,415 | 455,309 | 42,638 | 96,744 | ||||||||||||
Time deposits (non-brokered) | 6,181,676 | 6,299,760 | 6,614,153 | (118,084 | ) | (432,477 | ) | ||||||||||
Time deposits (brokered CDs) | 1,915,426 | 2,040,651 | 2,112,042 | (125,225 | ) | (196,616 | ) | ||||||||||
Total deposits | $ | 26,395,054 | $ | 26,759,428 | $ | 26,319,499 | $ | (364,374 | ) | $ | 75,555 | ||||||
[1] Includes interest and non-interest demand bearing deposits. | |||||||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | ||||||||||||||||||||||||||
Table H - Non-Performing Assets | ||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||
Variance | ||||||||||||||||||||||||||
(Dollars in thousands) | 30-Sep-13 | As a % of loans HIP by category | 30-Jun-13 | As a % of loans HIP by category | 30-Sep-12 | As a % of loans HIP by category |
Q3 2013 vs. |
Q3 2013 vs. |
||||||||||||||||||
Non-accrual loans: | ||||||||||||||||||||||||||
Commercial | $ | 316,040 | 3.2 | % | $ | 323,155 | 3.3 | % | $ | 772,217 | 8.0 | % | $ | (7,115 | ) | $ | (456,177 | ) | ||||||||
Construction | 28,782 | 9.8 | 44,878 | 15.1 | 49,933 | 19.3 | (16,096 | ) | (21,151 | ) | ||||||||||||||||
Legacy [1] | 24,206 | 10.3 | 28,434 | 10.8 | 48,735 | 10.5 | (4,228 | ) | (24,529 | ) | ||||||||||||||||
Lease financing | 3,716 | 0.7 | 4,511 | 0.8 | 4,837 | 0.9 | (795 | ) | (1,121 | ) | ||||||||||||||||
Mortgage | 203,208 | 3.1 | 171,822 | 2.6 | 632,052 | 10.5 | 31,386 | (428,844 | ) | |||||||||||||||||
Consumer | 41,621 | 1.1 | 41,067 | 1.1 | 42,726 | 1.1 | 554 | (1,105 | ) | |||||||||||||||||
Total non-performing loans held-in-portfolio, excluding covered loans |
617,573 | 2.9 | % | 613,867 | 2.9 | % | 1,550,500 | 7.5 | % | 3,706 | (932,927 | ) | ||||||||||||||
Non-performing loans held-for-sale [2] |
2,099 | 10,697 | 108,886 | (8,598 | ) | (106,787 | ) | |||||||||||||||||||
Other real estate owned (“OREO”), excluding covered OREO |
135,502 | 158,920 | 252,024 | (23,418 | ) | (116,522 | ) | |||||||||||||||||||
Total non-performing assets, excluding covered assets |
755,174 | 783,484 | 1,911,410 | (28,310 | ) | (1,156,236 | ) | |||||||||||||||||||
Covered loans and OREO | 188,353 | 208,993 | 208,235 | (20,640 | ) | (19,882 | ) | |||||||||||||||||||
Total non-performing assets | $ | 943,527 | $ | 992,477 | $ | 2,119,645 | $ | (48,950 | ) | $ | (1,176,118 | ) | ||||||||||||||
Accruing loans past due 90 days or more [3] | $ | 414,189 | $ | 414,055 | $ | 379,051 | $ | 134 | $ | 35,138 | ||||||||||||||||
Ratios excluding covered loans: | ||||||||||||||||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio |
2.88 |
% |
|
2.85 |
% |
|
7.47 |
% |
|
|||||||||||||||||
Allowance for loan losses to loans held-in-portfolio |
2.46 | 2.46 | 3.07 | |||||||||||||||||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale |
85.19 | 86.14 | 41.04 | |||||||||||||||||||||||
Ratios including covered loans: | ||||||||||||||||||||||||||
Non-performing assets to total assets | 2.62 |
% |
|
2.71 |
% |
|
5.81 |
% |
|
|||||||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio |
2.64 | 2.59 | 6.63 | |||||||||||||||||||||||
Allowance for loan losses to loans held-in-portfolio |
2.62 | 2.57 | 3.09 | |||||||||||||||||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale |
99.53 | 99.31 | 46.61 | |||||||||||||||||||||||
[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 segment. | ||||||||||||||||||||||||||
[2] Non-performing loans held-for-sale as of September 30, 2013 consisted of $1.7 million in legacy loans and $0.4 million in mortgage loans (June 30, 2013 - $3 million in commercial loans, $2 million in legacy loans and $6 million in mortgage loans; September 30, 2012 - $88 million in construction loans, $18 million in commercial loans, $3 million in legacy loans and $53 thousand 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 $113 million of residential mortgage loans insured by FHA or guaranteed by the VA that are no longer accruing interest as of September 30, 2013. | ||||||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | |||||||||||||||||||||||||
Table I - Activity in Non-Performing Loans | |||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
Commercial loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
30-Sep-13 | 30-Jun-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 199,720 | $ | 123,435 | $ | 323,155 | $ | 186,808 | $ | 133,979 | $ | 320,787 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 40,257 | 17,898 | 58,155 | 59,736 | 15,763 | 75,499 | |||||||||||||||||||
Advances on existing non-performing loans | - | 304 | 304 | - | 1,226 | 1,226 | |||||||||||||||||||
Other | - | - | - | - | 4,310 | 4,310 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (811 | ) | (1,036 | ) | (1,847 | ) | (2,191 | ) | (532 | ) | (2,723 | ) | |||||||||||||
Non-performing loans charged-off | (17,773 | ) | (9,572 | ) | (27,345 | ) | (32,511 | ) | (9,890 | ) | (42,401 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (16,824 | ) | (19,073 | ) | (35,897 | ) | (12,122 | ) | (18,827 | ) | (30,949 | ) | |||||||||||||
Loans transferred to held-for-sale | - | (485 | ) | (485 | ) | - | (2,594 | ) | (2,594 | ) | |||||||||||||||
Ending balance NPLs | $ | 204,569 | $ | 111,471 | $ | 316,040 | $ | 199,720 | $ | 123,435 | $ | 323,155 | |||||||||||||
Construction loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
30-Sep-13 | 30-Jun-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 39,044 | $ | 5,834 | $ | 44,878 | $ | 45,036 | $ | 5,884 | $ | 50,920 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 2,000 | - | 2,000 | - | - | - | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (775 | ) | - | (775 | ) | - | - | - | |||||||||||||||||
Non-performing loans charged-off | (1,442 | ) | - | (1,442 | ) | (2,175 | ) | - | (2,175 | ) | |||||||||||||||
Loans returned to accrual status / loan collections | (15,808 | ) | (71 | ) | (15,879 | ) | (3,817 | ) | (50 | ) | (3,867 | ) | |||||||||||||
Ending balance NPLs | $ | 23,019 | $ | 5,763 | $ | 28,782 | $ | 39,044 | $ | 5,834 | $ | 44,878 | |||||||||||||
Mortgage loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
30-Sep-13 | 30-Jun-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 144,717 | $ | 27,105 | $ | 171,822 | $ | 572,731 | $ | 27,993 | $ | 600,724 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 93,867 | 5,265 | 99,132 | 98,682 | 6,888 | 105,570 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (3,161 | ) | (1,236 | ) | (4,397 | ) | (19,800 | ) | (1,106 | ) | (20,906 | ) | |||||||||||||
Non-performing loans charged-off | (5,539 | ) | (1,791 | ) | (7,330 | ) | (6,365 | ) | (2,653 | ) | (9,018 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (52,049 | ) | (3,970 | ) | (56,019 | ) | (50,956 | ) | (4,017 | ) | (54,973 | ) | |||||||||||||
Loans transferred to held-for-sale | - | - | - | (14,968 | ) | - | (14,968 | ) | |||||||||||||||||
Non-performing loans sold[1] | - | - | - | (434,607 | ) | - | (434,607 | ) | |||||||||||||||||
Ending balance NPLs | $ | 177,835 | $ | 25,373 | $ | 203,208 | $ | 144,717 | $ | 27,105 | $ | 171,822 | |||||||||||||
[1] Includes write-downs of $199,502 of loans sold at BPPR during the quarter ended June 30, 2013. | |||||||||||||||||||||||||
Legacy loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
30-Sep-13 | 30-Jun-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | - | $ | 28,434 | $ | 28,434 | $ | - | $ | 35,830 | $ | 35,830 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | - | 3,168 | 3,168 | - | 4,640 | 4,640 | |||||||||||||||||||
Advances on existing non-performing loans | - | 97 | 97 | - | 4 | 4 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans charged-off | - | (5,013 | ) | (5,013 | ) | - | (5,358 | ) | (5,358 | ) | |||||||||||||||
Loans returned to accrual status / loan collections | - | (2,480 | ) | (2,480 | ) | - | (2,373 | ) | (2,373 | ) | |||||||||||||||
Other | - | - | - | - | (4,309 | ) | (4,309 | ) | |||||||||||||||||
Ending balance NPLs | $ | - | $ | 24,206 | $ | 24,206 | $ | - | $ | 28,434 | $ | 28,434 | |||||||||||||
Total non-performing loans held-in-portfolio (excluding consumer loans): | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
30-Sep-13 | 30-Jun-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 383,481 | $ | 184,808 | $ | 568,289 | $ | 804,575 | $ | 203,686 | $ | 1,008,261 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 136,124 | 26,331 | 162,455 | 158,418 | 27,291 | 185,709 | |||||||||||||||||||
Advances on existing non-performing loans | - | 401 | 401 | - | 1,230 | 1,230 | |||||||||||||||||||
Other | - | - | - | - | 4,310 | 4,310 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (4,747 | ) | (2,272 | ) | (7,019 | ) | (21,991 | ) | (1,638 | ) | (23,629 | ) | |||||||||||||
Non-performing loans charged-off | (24,754 | ) | (16,376 | ) | (41,130 | ) | (41,051 | ) | (17,901 | ) | (58,952 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (84,681 | ) | (25,594 | ) | (110,275 | ) | (66,895 | ) | (25,267 | ) | (92,162 | ) | |||||||||||||
Loans transferred to held-for-sale | - | (485 | ) | (485 | ) | (14,968 | ) | (2,594 | ) | (17,562 | ) | ||||||||||||||
Non-performing loans sold[1] | - | - | - | (434,607 | ) | - | (434,607 | ) | |||||||||||||||||
Other | - | - | - | - | (4,309 | ) | (4,309 | ) | |||||||||||||||||
Ending balance NPLs | $ | 405,423 | $ | 166,813 | $ | 572,236 | $ | 383,481 | $ | 184,808 | $ | 568,289 | |||||||||||||
[1] Includes write-downs of $199,502 of loans sold at BPPR during the quarter ended June 30, 2013. | |||||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | ||||||||||||||||||||||||||||||||||||||||
Table J - Allowance for Credit Losses, Net Charge-offs and Related Ratios | ||||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | ||||||||||||||||||||||||||||||||||||||
30-Sep-13 | 30-Jun-13 | 30-Sep-12 | ||||||||||||||||||||||||||||||||||||||
(Dollars in thousands) | Non-covered loans |
Covered loans |
Total | Non-covered loans | Covered loans | Total | Non-covered loans | Covered loans | Total | |||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 528,762 | $ | 106,457 | $ | 635,219 | $ | 583,501 | $ | 99,867 | $ | 683,368 | $ | 648,535 | $ | 117,495 | $ | 766,030 | ||||||||||||||||||||||
Provision for loan losses | 55,230 | 17,433 | 72,663 | 223,908 | 25,500 | 249,408 | 83,589 | 22,619 | 106,208 | |||||||||||||||||||||||||||||||
583,992 | 123,890 | 707,882 | 807,409 | 125,367 | 932,776 | 732,124 | 140,114 | 872,238 | ||||||||||||||||||||||||||||||||
Net loans charged-off (recovered): | ||||||||||||||||||||||||||||||||||||||||
BPPR | ||||||||||||||||||||||||||||||||||||||||
Commercial | 16,145 | 2,533 | 18,678 | 29,968 | 1,108 | 31,076 | 37,019 | 7,013 | 44,032 | |||||||||||||||||||||||||||||||
Construction | (4,906 | ) | 2,893 | (2,013 | ) | (2,294 | ) | 15,702 | 13,408 | (527 | ) | 7,483 | 6,956 | |||||||||||||||||||||||||||
Lease financing | 470 | - | 470 | 1,213 | - | 1,213 | 265 | - | 265 | |||||||||||||||||||||||||||||||
Mortgage | 11,393 | 1,579 | 12,972 | 12,589 | 2,255 | 14,844 | 12,431 | 736 | 13,167 | |||||||||||||||||||||||||||||||
Consumer | 21,576 | 57 | 21,633 | 19,928 | (155 | ) | 19,773 | 21,853 | 9 | 21,862 | ||||||||||||||||||||||||||||||
Total BPPR | 44,678 | 7,062 | 51,740 | 61,404 | 18,910 | 80,314 | 71,041 | 15,241 | 86,282 | |||||||||||||||||||||||||||||||
BPNA | ||||||||||||||||||||||||||||||||||||||||
Commercial | 4,543 | - | 4,543 | 9,808 | - | 9,808 | 9,611 | - | 9,611 | |||||||||||||||||||||||||||||||
Legacy [1] | 2,321 | - | 2,321 | (917 | ) | - | (917 | ) | 3,952 | - | 3,952 | |||||||||||||||||||||||||||||
Mortgage | 1,334 | - | 1,334 | 3,018 | - | 3,018 | 3,541 | - | 3,541 | |||||||||||||||||||||||||||||||
Consumer | 5,016 | - | 5,016 | 5,832 | - | 5,832 | 7,646 | - | 7,646 | |||||||||||||||||||||||||||||||
Total BPNA | 13,214 | - | 13,214 | 17,741 | - | 17,741 | 24,750 | - | 24,750 | |||||||||||||||||||||||||||||||
Total loans charged-off (recovered) - Popular, Inc. | 57,892 | 7,062 | 64,954 | 79,145 | 18,910 | 98,055 | 95,791 | 15,241 | 111,032 | |||||||||||||||||||||||||||||||
Net write-downs [3] | - | - | - | (199,502 | ) | - | (199,502 | ) | (34 | ) | - | (34 | ) | |||||||||||||||||||||||||||
Balance at end of period | $ | 526,100 | $ | 116,828 | $ | 642,928 | $ | 528,762 | $ | 106,457 | $ | 635,219 | $ | 636,299 | $ | 124,873 | $ | 761,172 | ||||||||||||||||||||||
POPULAR, INC. | ||||||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 1.08 |
% |
|
1.06 |
% |
|
1.47 |
% |
|
1.58 |
% |
|
1.87 |
% |
|
1.82 |
% |
|
||||||||||||||||||||||
Provision for loan losses to net charge-offs [2] | 0.95 |
x |
|
1.12 |
x |
|
0.69 |
x |
|
0.82 |
x |
|
0.87 |
x |
|
0.96 |
x |
|
||||||||||||||||||||||
BPPR | ||||||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 1.15 |
% |
|
1.11 |
% |
|
1.55 |
% |
|
1.68 |
% |
|
1.92 |
% |
|
1.84 |
% |
|
||||||||||||||||||||||
Provision for loan losses to net charge-offs [2] | 1.13 |
x |
|
1.31 |
x |
|
1.00 |
x |
|
1.08 |
x |
|
0.98 |
x |
|
1.07 |
x |
|
||||||||||||||||||||||
BPNA | ||||||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 0.91 |
% |
|
1.24 |
% |
|
1.74 |
% |
|
|||||||||||||||||||||||||||||||
Provision (reversal) for loan losses to net charge-offs | 0.36 |
x |
|
(0.37 | ) | x | 0.56 |
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 segment. | ||||||||||||||||||||||||||||||||||||||||
[2] Excluding provision for loan losses and net write-down related to the asset sale during the quarter ended June 30, 2013. | ||||||||||||||||||||||||||||||||||||||||
[3] Net write-downs for the quarter ended June 30, 2013 are related to loans sold. | ||||||||||||||||||||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | ||||||||||||||||||||||
Table K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
30-Sep-13 | ||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage | Lease financing | Consumer |
Total [2] |
|||||||||||||||
Specific ALLL | $ 20,836 | $ 588 | $ - | $ 53,782 | $ 1,197 | $ 31,662 | $ 108,065 | |||||||||||||||
Impaired loans | [1] | $ 338,829 | $ 27,492 | $ 11,597 | $ 443,186 | $ 3,159 | $ 129,859 | $ 954,122 | ||||||||||||||
Specific ALLL to impaired loans | [1] | 6.15 | % | 2.14 | % | - | % | 12.14 | % | 37.89 | % | 24.38 | % | 11.33 | % | |||||||
General ALLL | $ 136,476 | $ 9,032 | $ 16,696 | $ 107,941 | $ 9,494 | $ 138,396 | $ 418,035 | |||||||||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $ 9,506,648 | $ 265,728 | $ 224,048 | $ 6,169,947 | $ 536,131 | $ 3,770,559 | $ 20,473,061 | ||||||||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 1.44 | % | 3.40 | % | 7.45 | % | 1.75 | % | 1.77 | % | 3.67 | % | 2.04 | % | |||||||
Total ALLL | $ 157,312 | $ 9,620 | $ 16,696 | $ 161,723 | $ 10,691 | $ 170,058 | $ 526,100 | |||||||||||||||
Total non-covered loans held-in-portfolio | [1] | $ 9,845,477 | $ 293,220 | $ 235,645 | $ 6,613,133 | $ 539,290 | $ 3,900,418 | $ 21,427,183 | ||||||||||||||
ALLL to loans held-in-portfolio | [1] | 1.60 | % | 3.28 | % | 7.09 | % | 2.45 | % | 1.98 | % | 4.36 | % | 2.46 | % | |||||||
[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, 2013, the general allowance on the covered loans amounted to $113 million, while the specific reserve amounted to $4 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. | ||||||||||||||||||||||
30-Jun-13 | ||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage | Lease financing | Consumer |
Total [2] |
|||||||||||||||
Specific ALLL | $ 18,719 | $ 1,401 | $ - | $ 53,278 | $ 1,399 | $ 31,254 | $ 106,051 | |||||||||||||||
Impaired loans | [1] | $ 334,861 | $ 45,376 | $ 13,368 | $ 435,205 | $ 3,818 | $ 130,166 | $ 962,794 | ||||||||||||||
Specific ALLL to impaired loans | [1] | 5.59 | % | 3.09 | % | - | % | 12.24 | % | 36.64 | % | 24.01 | % | 11.01 | % | |||||||
General ALLL | $ 145,762 | $ 8,009 | $ 19,978 | $ 102,702 | $ 7,524 | $ 138,736 | $ 422,711 | |||||||||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $ 9,582,979 | $ 251,634 | $ 248,860 | $ 6,168,382 | $ 534,530 | $ 3,772,480 | $ 20,558,865 | ||||||||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 1.52 | % | 3.18 | % | 8.03 | % | 1.66 | % | 1.41 | % | 3.68 | % | 2.06 | % | |||||||
Total ALLL | $ 164,481 | $ 9,410 | $ 19,978 | $ 155,980 | $ 8,923 | $ 169,990 | $ 528,762 | |||||||||||||||
Total non-covered loans held-in-portfolio | [1] | $ 9,917,840 | $ 297,010 | $ 262,228 | $ 6,603,587 | $ 538,348 | $ 3,902,646 | $ 21,521,659 | ||||||||||||||
ALLL to loans held-in-portfolio | [1] | 1.66 | % | 3.17 | % | 7.62 | % | 2.36 | % | 1.66 | % | 4.36 | % | 2.46 | % | |||||||
[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, 2013, the general allowance on the covered loans amounted to $103 million, while the specific reserve amounted to $3 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 | ||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy | Mortgage | Lease financing | Consumer | Total | |||||||||||||
Specific ALLL | $ 2,117 | $ (813 | ) | $ - | $ 504 | $ (202 | ) | $ 408 | $ 2,014 | |||||||||||
Impaired loans | $ 3,968 | $ (17,884 | ) | $ (1,771 | ) | $ 7,981 | $ (659 | ) | $ (307 | ) | $ (8,672 | ) | ||||||||
General ALLL | $ (9,286 | ) | $ 1,023 | $ (3,282 | ) | $ 5,239 | $ 1,970 | $ (340 | ) | $ (4,676 | ) | |||||||||
Loans held-in-portfolio, excluding impaired loans | $ (76,331 | ) | $ 14,094 | $ (24,812 | ) | $ 1,565 | $ 1,601 | $ (1,921 | ) | $ (85,804 | ) | |||||||||
Total ALLL | $ (7,169 | ) | $ 210 | $ (3,282 | ) | $ 5,743 | $ 1,768 | $ 68 | $ (2,662 | ) | ||||||||||
Total non-covered loans held-in-portfolio | $ (72,363 | ) | $ (3,790 | ) | $ (26,583 | ) | $ 9,546 | $ 942 | $ (2,228 | ) | $ (94,476 | ) |
Popular, Inc. | |||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | |||||||||||||||||||
Table L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
30-Sep-13 | |||||||||||||||||||
Puerto Rico | |||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL non-covered loans | $ 20,836 | $ 588 | $ 36,227 | $ 1,197 | $ 31,338 | $ 90,186 | |||||||||||||
General ALLL non-covered loans | 82,468 | 8,718 | 95,668 | 9,494 | 112,839 | 309,187 | |||||||||||||
ALLL - non-covered loans | 103,304 | 9,306 | 131,895 | 10,691 | 144,177 | 399,373 | |||||||||||||
Specific ALLL covered loans | 1,683 | 1,944 | - | - | - | 3,627 | |||||||||||||
General ALLL covered loans | 56,813 | 16,674 | 32,175 | - | 7,539 | 113,201 | |||||||||||||
ALLL - covered loans | 58,496 | 18,618 | 32,175 | - | 7,539 | 116,828 | |||||||||||||
Total ALLL | $ 161,800 | $ 27,924 | $ 164,070 | $ 10,691 | $ 151,716 | $ 516,201 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired non-covered loans | $ 276,824 | $ 21,729 | $ 390,319 | $ 3,159 | $ 127,389 | $ 819,420 | |||||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 5,978,200 | 230,141 | 4,953,363 | 536,131 | 3,147,132 | 14,844,967 | |||||||||||||
Non-covered loans held-in-portfolio | 6,255,024 | 251,870 | 5,343,682 | 539,290 | 3,274,521 | 15,664,387 | |||||||||||||
Impaired covered loans | 35,264 | - | - | - | - | 35,264 | |||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | 1,818,587 | 201,437 | 965,779 | - | 54,942 | 3,040,745 | |||||||||||||
Covered loans held-in-portfolio | 1,853,851 | 201,437 | 965,779 | - | 54,942 | 3,076,009 | |||||||||||||
Total loans held-in-portfolio | $ 8,108,875 | $ 453,307 | $ 6,309,461 | $ 539,290 | $ 3,329,463 | $ 18,740,396 | |||||||||||||
30-Jun-13 | |||||||||||||||||||
Puerto Rico | |||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL non-covered loans | $ 18,719 | $ 1,401 | $ 35,715 | $ 1,399 | $ 30,904 | $ 88,138 | |||||||||||||
General ALLL non-covered loans | 93,433 | 7,671 | 87,200 | 7,524 | 109,610 | 305,438 | |||||||||||||
ALLL - non-covered loans | 112,152 | 9,072 | 122,915 | 8,923 | 140,514 | 393,576 | |||||||||||||
Specific ALLL covered loans | 1,981 | 750 | - | - | - | 2,731 | |||||||||||||
General ALLL covered loans | 63,576 | 6,603 | 27,001 | - | 6,546 | 103,726 | |||||||||||||
ALLL - covered loans | 65,557 | 7,353 | 27,001 | - | 6,546 | 106,457 | |||||||||||||
Total ALLL | $ 177,709 | $ 16,425 | $ 149,916 | $ 8,923 | $ 147,060 | $ 500,033 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired non-covered loans | $ 271,177 | $ 39,542 | $ 382,398 | $ 3,818 | $ 127,643 | $ 824,578 | |||||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 6,052,606 | 216,960 | 4,931,072 | 534,530 | 3,131,734 | 14,866,902 | |||||||||||||
Non-covered loans held-in-portfolio | 6,323,783 | 256,502 | 5,313,470 | 538,348 | 3,259,377 | 15,691,480 | |||||||||||||
Impaired covered loans | 25,092 | - | - | - | - | 25,092 | |||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | 1,875,378 | 240,365 | 999,578 | - | 59,585 | 3,174,906 | |||||||||||||
Covered loans held-in-portfolio | 1,900,470 | 240,365 | 999,578 | - | 59,585 | 3,199,998 | |||||||||||||
Total loans held-in-portfolio | $ 8,224,253 | $ 496,867 | $ 6,313,048 | $ 538,348 | $ 3,318,962 | $ 18,891,478 | |||||||||||||
Variance | |||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL non-covered loans | $ 2,117 | $ (813 | ) | $ 512 | $ (202 | ) | $ 434 | $ 2,048 | |||||||||||
General ALLL non-covered loans | (10,965 | ) | 1,047 | 8,468 | 1,970 | 3,229 | 3,749 | ||||||||||||
ALLL - non-covered loans | (8,848 | ) | 234 | 8,980 | 1,768 | 3,663 | 5,797 | ||||||||||||
Specific ALLL covered loans | (298 | ) | 1,194 | - | - | - | 896 | ||||||||||||
General ALLL covered loans | (6,763 | ) | 10,071 | 5,174 | - | 993 | 9,475 | ||||||||||||
ALLL - covered loans | (7,061 | ) | 11,265 | 5,174 | - | 993 | 10,371 | ||||||||||||
Total ALLL | $ (15,909 | ) | $ 11,499 | $ 14,154 | $ 1,768 | $ 4,656 | $ 16,168 | ||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired non-covered loans | $ 5,647 | $ (17,813 | ) | $ 7,921 | $ (659 | ) | $ (254 | ) | $ (5,158 | ) | |||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | (74,406 | ) | 13,181 | 22,291 | 1,601 | 15,398 | (21,935 | ) | |||||||||||
Non-covered loans held-in-portfolio | (68,759 | ) | (4,632 | ) | 30,212 | 942 | 15,144 | (27,093 | ) | ||||||||||
Impaired covered loans | 10,172 | - | - | - | - | 10,172 | |||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | (56,791 | ) | (38,928 | ) | (33,799 | ) | - | (4,643 | ) | (134,161 | ) | ||||||||
Covered loans held-in-portfolio | (46,619 | ) | (38,928 | ) | (33,799 | ) | - | (4,643 | ) | (123,989 | ) | ||||||||
Total loans held-in-portfolio | $ (115,378 | ) | $ (43,560 | ) | $ (3,587 | ) | $ 942 | $ 10,501 | $ (151,082 | ) | |||||||||
Popular, Inc. | |||||||||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | |||||||||||||||||||
Table M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
30-Sep-13 | |||||||||||||||||||
U.S. Mainland | |||||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL | $ - | $ - | $ - | $ 17,555 | $ 324 | $ 17,879 | |||||||||||||
General ALLL | 54,008 | 314 | 16,696 | 12,273 | 25,557 | 108,848 | |||||||||||||
Total ALLL | $ 54,008 | $ 314 | $ 16,696 | $ 29,828 | $ 25,881 | $ 126,727 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired loans | $ 62,005 | $ 5,763 | $ 11,597 | $ 52,867 | $ 2,470 | $ 134,702 | |||||||||||||
Loans held-in-portfolio, excluding impaired loans | 3,528,448 | 35,587 | 224,048 | 1,216,584 | 623,427 | 5,628,094 | |||||||||||||
Total loans held-in-portfolio | $ 3,590,453 | $ 41,350 | $ 235,645 | $ 1,269,451 | $ 625,897 | $ 5,762,796 | |||||||||||||
30-Jun-13 | |||||||||||||||||||
U.S. Mainland | |||||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL | $ - | $ - | $ - | $ 17,563 | $ 350 | $ 17,913 | |||||||||||||
General ALLL | 52,329 | 338 | 19,978 | 15,502 | 29,126 | 117,273 | |||||||||||||
Total ALLL | $ 52,329 | $ 338 | $ 19,978 | $ 33,065 | $ 29,476 | $ 135,186 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired loans | $ 63,684 | $ 5,834 | $ 13,368 | $ 52,807 | $ 2,523 | $ 138,216 | |||||||||||||
Loans held-in-portfolio, excluding impaired loans | 3,530,373 | 34,674 | 248,860 | 1,237,310 | 640,746 | 5,691,963 | |||||||||||||
Total loans held-in-portfolio | $ 3,594,057 | $ 40,508 | $ 262,228 | $ 1,290,117 | $ 643,269 | $ 5,830,179 | |||||||||||||
Variance | |||||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL | $ - | $ - | $ - | $ (8 | ) | $ (26 | ) | $ (34 | ) | ||||||||||
General ALLL | 1,679 | (24 | ) | (3,282 | ) | (3,229 | ) | (3,569 | ) | (8,425 | ) | ||||||||
Total ALLL | $ 1,679 | $ (24 | ) | $ (3,282 | ) | $ (3,237 | ) | $ (3,595 | ) | $ (8,459 | ) | ||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired loans | $ (1,679 | ) | $ (71 | ) | $ (1,771 | ) | $ 60 | $ (53 | ) | $ (3,514 | ) | ||||||||
Loans held-in-portfolio, excluding impaired loans | (1,925 | ) | 913 | (24,812 | ) | (20,726 | ) | (17,319 | ) | (63,869 | ) | ||||||||
Total loans held-in-portfolio | $ (3,604 | ) | $ 842 | $ (26,583 | ) | $ (20,666 | ) | $ (17,372 | ) | $ (67,383 | ) | ||||||||
Popular, Inc. | ||||||||||||
Financial Supplement to Third Quarter 2013 Earnings Release | ||||||||||||
Table N - Reconciliation to GAAP Financial Measures | ||||||||||||
(Unaudited) | ||||||||||||
(In thousands, except share or per share information) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | |||||||||
Total stockholders’ equity | $ 4,393,885 | $ 4,195,036 | $ 4,068,984 | |||||||||
Less: Preferred stock | (50,160 | ) | (50,160 | ) | (50,160 | ) | ||||||
Less: Goodwill | (647,757 | ) | (647,757 | ) | (647,757 | ) | ||||||
Less: Other intangibles | (46,892 | ) | (49,359 | ) | (56,762 | ) | ||||||
Total tangible common equity | $ 3,649,076 | $ 3,447,760 | $ 3,314,305 | |||||||||
Total assets | $ 36,052,116 | $ 36,684,594 | $ 36,503,366 | |||||||||
Less: Goodwill | (647,757 | ) | (647,757 | ) | (647,757 | ) | ||||||
Less: Other intangibles | (46,892 | ) | (49,359 | ) | (56,762 | ) | ||||||
Total tangible assets | $ 35,357,467 | $ 35,987,478 | $ 35,798,847 | |||||||||
Tangible common equity to tangible assets | 10.32 | % | 9.58 | % | 9.26 | % | ||||||
Common shares outstanding at end of period | 103,327,146 | 103,276,131 | 103,097,143 | |||||||||
Tangible book value per common share | $ 35.32 | $ 33.38 | $ 32.15 | |||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | 30-Sep-12 | |||||||||
Common stockholders’ equity | $ 4,343,725 | $ 4,144,876 | $ 4,018,824 | |||||||||
Less: Unrealized losses (gains) on available-for-sale securities, net of tax[1] | 5,514 | (23,990 | ) | (175,769 | ) | |||||||
Less: Disallowed deferred tax assets[2] | (643,716 | ) | (647,010 | ) | (365,954 | ) | ||||||
Less: Disallowed goodwill and other intangible assets | (646,464 | ) | (650,452 | ) | (666,166 | ) | ||||||
Less: Aggregate adjusted carrying value of all non-financial equity investments | (1,398 | ) | (1,357 | ) | (1,154 | ) | ||||||
Add: Pension liability adjustment, net of tax and accumulated net gains (losses) on cash flow hedges[3] |
216,274 | 216,823 | 205,309 | |||||||||
Total Tier 1 common equity | $ 3,273,935 | $ 3,038,890 | $ 3,015,090 | |||||||||
Tier 1 common equity to risk-weighted assets | 14.20 | % | 13.04 | % | 12.72 | % | ||||||
[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 $160 million of the Corporation’s $844 million of net deferred tax assets at September 30, 2013 (June 30, 2013 - $178 million and $864 million, respectively; September 30, 2012 - $153 million and $546 million, respectively), were included without limitation in regulatory capital pursuant to the risk-based capital guidelines, while approximately $644 million of such assets at September 30, 2013 (June 30, 2013 - $647 million; September 30, 2012 - $366 million) exceeded the limitation imposed by these guidelines and, as “disallowed deferred tax assets”, were deducted in arriving at Tier 1 capital. The remaining $40 million of the Corporation’s other net deferred tax assets at September 30, 2013 (June 30, 2013 - $39 million; September 30, 2012 - $27 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 2013 Earnings Release | |||||||||||||||||
Table O - Financial Information - Westernbank Covered Loans | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Revenues |
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Quarters ended | |||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | Variance | ||||||||||||||
Interest income on covered loans | $ | 71,631 | $ | 70,136 | $ | 1,495 | |||||||||||
FDIC loss share expense: | |||||||||||||||||
Amortization of indemnification asset | (37,681 | ) | (38,557 | ) | 876 | ||||||||||||
80% mirror accounting on credit impairment losses [1] | 13,946 | 25,338 | (11,392 | ) | |||||||||||||
80% mirror accounting on discount accretion on unfunded commitments | (87 | ) | (193 | ) | 106 | ||||||||||||
80% mirror accounting on reimbursable expenses | 25,641 | 12,131 | 13,510 | ||||||||||||||
80% mirror accounting on recoveries on covered assets, including rental income on OREOs, subject to reimbursement to the FDIC |
(11,533 | ) | (2,168 | ) | (9,365 | ) | |||||||||||
Change in true-up payment obligation | (5,322 | ) | (476 | ) | (4,846 | ) | |||||||||||
Other | 170 | 170 | - | ||||||||||||||
Total FDIC loss share expense | (14,866 | ) | (3,755 | ) | (11,111 | ) | |||||||||||
Other non-interest income | 109 | 242 | (133 | ) | |||||||||||||
Total revenues | 56,874 | 66,623 | (9,749 | ) | |||||||||||||
Provision for loan losses | 17,433 | 25,500 | (8,067 | ) | |||||||||||||
Total revenues less provision for loan losses | $ | 39,441 | $ | 41,123 | $ | (1,682 | ) | ||||||||||
[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 |
|||||||||||||||||
Quarters ended | |||||||||||||||||
(In millions) | 30-Sep-13 | 30-Jun-13 | Variance | ||||||||||||||
Covered loans | $ | 3,119 | $ | 3,269 | $ | (150 | ) | ||||||||||
FDIC loss share asset | 1,348 | 1,376 | (28 | ) | |||||||||||||
Activity in the carrying amount and accretable yield of covered loans accounted for under ASC 310-30 |
|||||||||||||||||
Quarters ended | |||||||||||||||||
30-Sep-13 | 30-Jun-13 | ||||||||||||||||
(In thousands) | Accretable yield |
Carrying amount |
Accretable yield |
Carrying amount |
|||||||||||||
Beginning balance | $ | 1,379,612 | $ | 3,012,866 | $ | 1,372,135 | $ | 3,157,663 | |||||||||
Accretion | (68,529 | ) | 68,529 | (62,536 | ) | 62,536 | |||||||||||
Changes in expected cash flows | (1,465 | ) | - | 70,013 | - | ||||||||||||
Collections / charge-offs | - | (190,346 | ) | - | (207,333 | ) | |||||||||||
Ending balance | 1,309,618 | 2,891,049 | 1,379,612 | 3,012,866 | |||||||||||||
Allowance for loan losses - ASC 310-30 covered loans | - | (108,874 | ) | - | (91,195 | ) | |||||||||||
Ending balance, net of allowance for loan losses | $ | 1,309,618 | $ | 2,782,175 | $ | 1,379,612 | $ | 2,921,671 | |||||||||
Activity in the carrying amount of the FDIC indemnity asset |
|||||||||||||||||
Quarters ended | |||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | |||||||||||||||
Balance at beginning of period | $ | 1,379,342 | $ | 1,380,592 | |||||||||||||
Amortization | (37,681 | ) | (38,557 | ) | |||||||||||||
Credit impairment losses to be covered under loss sharing agreements | 13,946 | 25,338 | |||||||||||||||
Decrease due to reciprocal accounting on the discount accretion on unfunded commitments | (87 | ) | (193 | ) | |||||||||||||
Reimbursable expenses to be covered under loss sharing agreements | 25,641 | 12,131 | |||||||||||||||
Net payments to (from) FDIC under loss sharing agreements | (52,865 | ) | - | ||||||||||||||
Other adjustments attributable to FDIC loss sharing agreements | (3,585 | ) | 31 | ||||||||||||||
Balance at end of period | $ | 1,324,711 | $ | 1,379,342 | |||||||||||||
Activity in the remaining FDIC loss share asset amortization |
|||||||||||||||||
Quarters ended | |||||||||||||||||
(In thousands) | 30-Sep-13 | 30-Jun-13 | |||||||||||||||
Balance at beginning of period | $ | 122,124 | $ | 128,682 | |||||||||||||
Amortization | (37,681 | ) | (38,557 | ) | |||||||||||||
Impact of lower projected losses | 38,053 | 31,999 | |||||||||||||||
Balance at end of period | $ | 122,496 | $ | 122,124 | |||||||||||||
CONTACT:
Popular, Inc.
Investor Relations:
Brett
Scheiner, 212-417-6721
Investor Relations Officer
or
Media
Relations:
Teruca Rullán, 787-281-5170
Mobile:
917-679-3596
Senior Vice President, Corporate Communications