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):
April
23, 2014
POPULAR,
INC.
(Exact
name of registrant as specified in its charter)
COMMONWEALTH OF PUERTO RICO |
001-34084 |
66-0667416 |
(State or other jurisdiction of |
(Commission File |
(IRS Employer Identification |
209 MUNOZ RIVERA AVENUE HATO REY, PUERTO RICO |
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 April 23, 2014 Popular, Inc. issued a news release announcing its unaudited financial results for the quarter ended March 31, 2014, 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 April 23, 2014
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: |
April 23, 2014 |
By: /s/ Jorge J. García |
Jorge J. García |
||
Senior Vice President and Corporate Comptroller |
Exhibit 99.1
Popular, Inc. Announces First Quarter Financial Results
SAN JUAN, Puerto Rico--(BUSINESS WIRE)--April 23, 2014--Popular, Inc. (the “Corporation” or “Popular”) (NASDAQ:BPOP) reported net income of $86.4 million for the quarter ended March 31, 2014, compared to net income of $163.0 million for the quarter ended December 31, 2013.
Mr. Richard L. Carrión, Chairman of the Board and Chief Executive Officer, said: "This quarter we are reporting solid financial results as well as announcing an important initiative to restructure our U.S. business. The payment of a dividend from PCB is also an important step in more effectively managing our capital structure. Although the business environment in our home market is challenging, we expect to continue to make progress in our capital management initiatives as the P.R. economy stabilizes."
Earnings Highlights | ||||||||||||
(Unaudited) | Quarters ended | |||||||||||
(Dollars in thousands, except per share information) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | |||||||||
Net interest income | $ | 372,967 | $ | 376,342 | $ | 346,313 | ||||||
Provision for loan losses – non-covered loans | 47,358 | 47,729 | 206,300 | |||||||||
Provision for loan losses – covered loans [1] | 25,714 | 8,907 | 17,556 | |||||||||
Net interest income after provision for loan losses | 299,895 | 319,706 | 122,457 | |||||||||
FDIC loss share expense | (24,206 | ) | (37,164 | ) | (26,266 | ) | ||||||
Other non-interest income | 130,771 | 228,354 | 60,323 | |||||||||
Operating expenses | 296,787 | 322,703 | 333,698 | |||||||||
Income (loss) before income tax | 109,673 | 188,193 | (177,184 | ) | ||||||||
Income tax expense (benefit) | 23,264 | 25,162 | (56,877 | ) | ||||||||
Net income (loss) | $ | 86,409 | $ | 163,031 | $ | (120,307 | ) | |||||
Net income (loss) applicable to common stock | $ | 85,478 | $ | 162,100 | $ | (121,237 | ) | |||||
Net income (loss) per common share - basic | $ | 0.83 | $ | 1.58 | $ | (1.18 | ) | |||||
Net income (loss) per common share - diluted | $ | 0.83 | $ | 1.57 | $ | (1.18 | ) | |||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. | ||||||||||||
Significant events
On April 23, 2014, the Corporation issued a press release announcing that it had entered into definitive agreements to sell its regional operations in California, Illinois and Central Florida to three different buyers and centralize certain back office operations in Puerto Rico and New York. The transactions will result in net premium of approximately $25 million and an estimated noncash goodwill write-down of approximately $160 million. An estimated restructuring charge of approximately $53 million will be taken by PCB, and annual operating expenses will be prospectively reduced by an estimated $45 million after the reorganization is complete. This decrease in expenses offsets a reduction in revenues that results from the sale of the regional operations.
The following tables reflect the results of operations for the first quarter of 2014 compared to the results of the fourth quarter of 2013, excluding the effect of the gain related to EVERTEC’s secondary public offering discussed below.
Quarters ended | ||||||||||||
(Unaudited) |
Adjusted Results |
|||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | Variance | |||||||||
Net interest income | $ | 372,967 | $ | 376,342 | $ | (3,375 | ) | |||||
Provision for loan losses – non-covered loans | 47,358 | 47,729 | (371 | ) | ||||||||
Provision for loan losses – covered loans [1] | 25,714 | 8,907 | 16,807 | |||||||||
Net interest income after provision for loan losses | 299,895 | 319,706 | (19,811 | ) | ||||||||
FDIC loss share expense | (24,206 | ) | (37,164 | ) | 12,958 | |||||||
Other non-interest income | 130,771 | 135,996 | (5,225 | ) | ||||||||
Operating expenses | 296,787 | 322,703 | (25,916 | ) | ||||||||
Income before income tax | 109,673 | 95,835 | 13,838 | |||||||||
Income tax expense | 23,264 | 21,217 | 2,047 | |||||||||
Net income | $ | 86,409 | $ | 74,618 | $ | 11,791 | ||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. | ||||||||||||
The results for the fourth quarter of 2013 exclude the after-tax gain of $88.4 million resulting from the Corporation’s sale of EVERTEC shares in connection with its public offering, net of the impact of $11 million from EVERTEC’s reduction in capital due to its repurchase of shares. The following table reflects the adjusted results for the fourth quarter of 2013.
Quarter ended | |||||||||||
(Unaudited) | 31-Dec-13 | ||||||||||
(In thousands) |
Actual Results |
Impact of |
Adjusted Results |
||||||||
Net interest income | $ | 376,342 | $ | - | $ | 376,342 | |||||
Provision for loan losses – non-covered loans | 47,729 | - | 47,729 | ||||||||
Provision for loan losses – covered loans [1] | 8,907 | - | 8,907 | ||||||||
Net interest income after provision for loan losses | 319,706 | - | 319,706 | ||||||||
FDIC loss share income (expense) | (37,164 | ) | - | (37,164 | ) | ||||||
Other non-interest income | 228,354 | 92,358 | 135,996 | ||||||||
Operating expenses | 322,703 | - | 322,703 | ||||||||
Income before income tax | 188,193 | 92,358 | 95,835 | ||||||||
Income tax expense | 25,162 | 3,945 | 21,217 | ||||||||
Net income | $ | 163,031 | $ | 88,413 | $ | 74,618 | |||||
[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 first quarter of 2014 decreased four basis points to 4.70%, when compared with the fourth quarter of 2013. Net interest income was $373.0 million, a decrease of $3.4 million from the previous quarter, which is largely attributed to the impact of having two fewer days in the first quarter of 2014 than in the fourth quarter of 2013. The main drivers of the decrease in the net interest income were:
These negative variances were partially offset by:
Non-interest income
Non-interest income decreased by $84.6 million compared with the fourth quarter of 2013. Excluding the impact of the gain on sale of EVERTEC shares during the fourth quarter of 2013, non-interest income decreased by $7.7 million quarter over quarter, driven primarily by the following items:
These negative variances were partially offset by:
Refer to table B for further details.
Financial Impact of FDIC-Assisted Transaction | ||||||||||||
(Unaudited) | Quarters ended | |||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | |||||||||
Income Statement |
||||||||||||
Interest income on covered loans | $ | 81,098 | $ | 86,794 | $ | 72,184 | ||||||
Total FDIC loss share expense | (24,206 | ) | (37,164 | ) | (26,266 | ) | ||||||
Other non-interest income | - | - | 242 | |||||||||
Provision for loan losses | 25,714 | 8,907 | 17,556 | |||||||||
Total revenues less provision for loan losses | $ | 31,178 | $ | 40,723 | $ | 28,604 | ||||||
Balance Sheet |
||||||||||||
Loans covered under loss-sharing agreements with FDIC | $ | 2,870,054 | $ | 2,984,427 | $ | 3,362,446 | ||||||
FDIC loss share asset | 833,721 | 948,608 | 1,380,592 | |||||||||
FDIC true-up payment obligation | 126,345 | 127,513 | 118,294 | |||||||||
See additional details on accounting for FDIC-Assisted transaction in Table O.
Operating expenses
Operating expenses decreased by $25.9 million when compared with the fourth quarter of 2013, driven primarily by:
Non-personnel credit-related costs, which include collections, appraisals, credit related fees, and OREO expenses, amounted to $13.6 million for the first quarter of 2014, compared with $20.8 million for the fourth quarter of 2013. The decrease was principally due to lower restructuring and collections expenses, mainly for covered loans, and higher gains on sales of OREO’s at BPPR.
Full-time equivalent employees (“FTEs”) were 8,053 as of March 31, 2014, compared with 8,059 as of December 31, 2013, and 8,144 as of March 31, 2013.
For a breakdown of operating expenses by category refer to table B.
Income taxes
Income tax expense for the first quarter of 2014 amounted to $23.3 million, for an effective tax rate of 21%, compared to $25.2 million for the fourth quarter of 2013. Excluding the effect of the sale of EVERTEC shares discussed above, the income tax expense for the fourth quarter of 2013 amounted to $21.2 million, for an effective tax rate of 22%.
Credit Quality
The following table presents non-performing assets information:
Non-Performing Assets | |||||||||
(Unaudited) | |||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||||
Total non-performing loans held-in-portfolio, excluding covered loans | $ | 635,334 | $ | 597,948 | $ | 1,050,608 | |||
Non-performing loans held-for-sale | 789 | 1,092 | 17,463 | ||||||
Other real estate owned (“OREO”), excluding covered OREO | 136,965 | 135,501 | 154,699 | ||||||
Total non-performing assets, excluding covered assets | 773,088 | 734,541 | 1,222,770 | ||||||
Covered loans and OREO | 182,659 | 197,388 | 198,870 | ||||||
Total non-performing assets | $ | 955,747 | $ | 931,929 | $ | 1,421,640 | |||
Net charge-offs for the quarter (excluding covered loans) | $ | 43,246 | $ | 35,366 | $ | 81,357 | |||
Ratios (excluding covered loans): | |||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | 2.94 | % | 2.77 | % | 4.86 | % | |||
Allowance for loan losses to loans held-in-portfolio | 2.51 | 2.49 | 2.70 | ||||||
Allowance for loan losses to non-performing loans, |
85.40 | 90.05 | 55.54 | ||||||
Refer to Table H for additional information. | |||||||||
Provision for Loan Losses | |||||||||||
(Unaudited) | Quarters ended | ||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||||||
Provision (reversal) for loan losses - non-covered loans: | |||||||||||
BPPR | $ | 53,915 | $ | 62,658 | $ | 204,289 | |||||
BPNA | (6,557 | ) | (14,929 | ) | 2,011 | ||||||
Total provision for loan losses - non-covered loans | 47,358 | 47,729 | 206,300 | ||||||||
Provision for loan losses - covered loans | 25,714 | 8,907 | 17,556 | ||||||||
Total provision for loan losses | $ | 73,072 | $ | 56,636 | $ | 223,856 | |||||
Credit Quality
Significant items influenced credit quality results for the first quarter of 2014. Adjusting for these items, overall credit trends remained stable during the quarter, particularly driven by strong credit quality results in the BPNA segment. Nevertheless, the Corporation continues to closely monitor macroeconomic conditions in Puerto Rico which continue to be challenging. The following presents credit quality performance for the first quarter of 2014 for the Corporation’s non-covered portfolio.
Credit Quality by Segment | ||||||||||||
(Unaudited) | ||||||||||||
(In thousands) | Quarters ended | |||||||||||
BPPR | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | |||||||||
Provision for loan losses | $ | 53,915 | $ | 62,658 | $ | 204,289 | ||||||
Net charge-offs | 45,950 | 35,256 | 62,424 [1] | |||||||||
Total non-performing loans held-in-portfolio, | ||||||||||||
excluding covered loans | 532,223 | 447,255 | 837,943 | |||||||||
Allowance / non-covered loans held-in-portfolio | 2.72 | % | 2.69 | % | 2.66 | % | ||||||
[1] For the quarter ended March 31, 2013, excludes net write-downs of $163.1 million related to the NPL’s bulk sale. | ||||||||||||
Quarters ended | ||||||||||||
BPNA | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | |||||||||
Provision for loan losses (reversal of provision) | $ | (6,557 | ) | $ | (14,929 | ) | $ | 2,011 | ||||
Net charge-offs (recoveries) | (2,704 | ) | 110 | 18,933 | ||||||||
Total non-performing loans held-in-portfolio, | ||||||||||||
excluding covered loans | 103,111 | 150,693 | 212,665 | |||||||||
Allowance / non-covered loans held-in-portfolio | 1.91 | % | 1.95 | % | 2.80 | % |
BPPR Segment
BPNA Segment
Financial Condition Highlights | |||||||||
(Unaudited) | |||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||||
Money market, trading and investment securities | $ | 8,056,145 | $ | 6,815,244 | $ | 7,305,343 | |||
Loans not covered under loss sharing agreements with the FDIC | 21,611,777 | 21,611,866 | 21,633,745 | ||||||
Loans covered under loss sharing agreements with the FDIC | 2,870,054 | 2,984,427 | 3,362,446 | ||||||
Total assets | 36,744,162 | 35,749,333 | 36,942,714 | ||||||
Deposits | 27,265,651 | 26,711,145 | 27,013,217 | ||||||
Borrowings | 3,715,821 | 3,645,246 | 4,969,344 | ||||||
Total liabilities | 31,998,415 | 31,123,183 | 32,971,571 | ||||||
Stockholders’ equity | 4,745,747 | 4,626,150 | 3,971,143 | ||||||
Total assets increased by approximately $994.8 million from the fourth quarter of 2013 driven by:
These decreases were partially offset by:
Total liabilities increased by $875.2 million from the fourth quarter of 2013, driven by:
Stockholders’ equity increased by $119.6 million from the fourth quarter of 2013, mainly as a result of the net income for the quarter of $86.4 million and a decrease of $26.1 million in 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.
Regulatory Capital
Popular’s regulatory capital ratios and that of its banking subsidiaries remained in excess of “well capitalized” regulatory requirements at March 31, 2014. The estimated common equity Tier 1 (“CET1”) ratio increased to 15.07% at March 31, 2014 compared to 14.83% at December 31, 2013 driven mainly by the impact of the current quarter’s earnings.
On April 22, 2014 the Corporation’s U.S. bank subsidiary (“PCB”) declared a $250 million cash dividend to the Bank Holding Company (“BHC”), $100 million of which was contributed as additional common equity by the BHC to the Puerto Rico banking subsidiary (“BPPR”). After giving effect to the impact of rebalancing capital among the banking subsidiaries and the BHC, the pro forma ratios would be as follows:
Estimated | Pro-forma 31-Mar-14 | |||||||||||||||||
(Unaudited) | 31-Mar-14 | after capital rebalancing | ||||||||||||||||
BPPR | ||||||||||||||||||
Tier 1 / CET1 | 13.68% | 14.24% | ||||||||||||||||
Total Capital | 14.96% | 15.52% | ||||||||||||||||
Total Leverage | 9.38% | 9.76% | ||||||||||||||||
PCB | ||||||||||||||||||
Tier 1 / CET1 | 25.12% | 20.54% | ||||||||||||||||
Total Capital | 26.38% | 21.80% | ||||||||||||||||
Total Leverage | 16.37% | 13.38% | ||||||||||||||||
BHC | ||||||||||||||||||
Tier 1 | 19.35% | |||||||||||||||||
CET1 | 15.07% | |||||||||||||||||
Total Capital | 20.62% | |||||||||||||||||
Total Leverage | 13.07% |
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, 2013, 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 among the top 50 U.S. banks by assets. In the United States, Popular has established a community-banking franchise providing a broad range of financial services and products with branches in New York, New Jersey, Illinois, Florida and California.
An electronic version of this press release can be found at the Corporation’s website: www.popular.com.
Popular will hold a conference call to discuss the financial results today Wednesday, April 23, 2014 at 11 a.m. Eastern Standard 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 1-888-317-6016 or 1-412-317-6016.
A replay of the webcast will be archived in Popular’s website. A telephone replay will be available one hour after the end of the conference call through Thursday, May 1, 2014 at 9:00 a.m. Eastern Standard Time, at 1-877-344-7529 or 1-412-317-0088. The replay passcode is 10043016.
Popular, Inc. |
Financial Supplement to First Quarter 2014 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 - Intentionally Left Blank (Consolidated Average Balances and Yield / Rate Analysis - YTD) |
Table F - Mortgage Banking Activities & 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 First Quarter 2014 Earnings Release | ||||||||||||
Table A - Selected Ratios and Other Information | ||||||||||||
(Unaudited) | ||||||||||||
Quarters ended | ||||||||||||
31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||||||||
Net income (loss) per common share: | ||||||||||||
Basic | $ | 0.83 | $ | 1.58 | ($1.18 | ) | ||||||
Diluted | $ | 0.83 | $ | 1.57 | ($1.18 | ) | ||||||
Average common shares outstanding | 102,799,752 | 102,774,144 | 102,664,608 | |||||||||
Average common shares outstanding - assuming dilution | 103,198,102 | 103,081,417 | 103,013,204 | |||||||||
Common shares outstanding at end of period | 103,455,535 | 103,397,699 | 103,228,615 | |||||||||
Market value per common share | $ | 30.99 | $ | 28.73 | $ | 27.60 | ||||||
Market capitalization - (In millions) | $ | 3,206 | $ | 2,971 | $ | 2,849 | ||||||
Return on average assets | 0.97 | % | 1.79 | % | (1.34 | )% | ||||||
Return on average common equity | 7.39 | % | 14.59 | % | (12.58 | )% | ||||||
Net interest margin [2] | 4.70 | % | 4.74 | % | 4.40 | % | ||||||
Common equity per share | $ | 45.39 | $ | 44.26 | $ | 37.98 | ||||||
Tangible common book value per common share (non-GAAP) [1] | $ | 38.71 | $ | 37.56 | $ | 31.21 | ||||||
Tangible common equity to tangible assets (non-GAAP) [1] | 11.11 | % | 11.08 | % | 8.89 | % | ||||||
Tier 1 risk-based capital [3] | 19.35 | % | 19.15 | % | 16.52 | % | ||||||
Total risk-based capital [3] | 20.62 | % | 20.42 | % | 17.80 | % | ||||||
Tier 1 leverage [3] | 13.07 | % | 12.85 | % | 11.07 | % | ||||||
Tier 1 common equity to risk-weighted assets (non-GAAP) [1] [3] | 15.07 | % | 14.83 | % | 12.36 | % | ||||||
[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 First Quarter 2014 Earnings Release | |||||||||||||||||||||
Table B - Consolidated Statement of Operations | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Quarters ended | Variance | Quarter ended | Variance | ||||||||||||||||||
(In thousands, except per share information) | 31-Mar-14 | 31-Dec-13 |
Q1 2014 |
31-Mar-13 |
Q1 2014 |
||||||||||||||||
Interest income: | |||||||||||||||||||||
Loans | $ | 401,933 | $ | 408,566 | $ | (6,633 | ) | $ | 385,926 | $ | 16,007 | ||||||||||
Money market investments | 973 | 832 | 141 | 955 | 18 | ||||||||||||||||
Investment securities | 35,127 | 34,317 | 810 | 37,823 | (2,696 | ) | |||||||||||||||
Trading account securities | 5,257 | 5,361 | (104 | ) | 5,514 | (257 | ) | ||||||||||||||
Total interest income | 443,290 | 449,076 | (5,786 | ) | 430,218 | 13,072 | |||||||||||||||
Interest expense: | |||||||||||||||||||||
Deposits | 29,392 | 31,396 | (2,004 | ) | 38,356 | (8,964 | ) | ||||||||||||||
Short-term borrowings | 9,041 | 9,320 | (279 | ) | 9,782 | (741 | ) | ||||||||||||||
Long-term debt | 31,890 | 32,018 | (128 | ) | 35,767 | (3,877 | ) | ||||||||||||||
Total interest expense | 70,323 | 72,734 | (2,411 | ) | 83,905 | (13,582 | ) | ||||||||||||||
Net interest income | 372,967 | 376,342 | (3,375 | ) | 346,313 | 26,654 | |||||||||||||||
Provision for loan losses - non-covered loans | 47,358 | 47,729 | (371 | ) | 206,300 | (158,942 | ) | ||||||||||||||
Provision for loan losses - covered loans | 25,714 | 8,907 | 16,807 | 17,556 | 8,158 | ||||||||||||||||
Net interest income after provision for loan losses | 299,895 | 319,706 | (19,811 | ) | 122,457 | 177,438 | |||||||||||||||
Service charges on deposit accounts | 41,250 | 42,154 | (904 | ) | 43,722 | (2,472 | ) | ||||||||||||||
Other service fees | 54,043 | 61,566 | (7,523 | ) | 56,093 | (2,050 | ) | ||||||||||||||
Mortgage banking activities | 3,681 | 14,392 | (10,711 | ) | 20,300 | (16,619 | ) | ||||||||||||||
Net gain and valuation adjustments on investment securities | - | 2,110 | (2,110 | ) | - | - | |||||||||||||||
Trading account profit (loss) | 1,977 | (1,547 | ) | 3,524 | (984 | ) | 2,961 | ||||||||||||||
Net gain (loss) on sale of loans, including valuation adjustments on loans held-for-sale | 11,776 | 5,402 | 6,374 | (62,719 | ) | 74,495 | |||||||||||||||
Adjustments (expense) to indemnity reserves on loans sold | (10,347 | ) | (6,892 | ) | (3,455 | ) | (16,143 | ) | 5,796 | ||||||||||||
FDIC loss share (expense) income | (24,206 | ) | (37,164 | ) | 12,958 | (26,266 | ) | 2,060 | |||||||||||||
Other operating income | 28,391 | 111,169 | (82,778 | ) | 20,054 | 8,337 | |||||||||||||||
Total non-interest income | 106,565 | 191,190 | (84,625 | ) | 34,057 | 72,508 | |||||||||||||||
Operating expenses: | |||||||||||||||||||||
Personnel costs | |||||||||||||||||||||
Salaries | 75,122 | 75,310 | (188 | ) | 73,345 | 1,777 | |||||||||||||||
Commissions, incentives and other bonuses | 13,658 | 13,965 | (307 | ) | 15,475 | (1,817 | ) | ||||||||||||||
Pension, postretirement and medical insurance | 9,771 | 13,948 | (4,177 | ) | 15,238 | (5,467 | ) | ||||||||||||||
Other personnel costs, including payroll taxes | 14,603 | 11,137 | 3,466 | 11,931 | 2,672 | ||||||||||||||||
Total personnel costs | 113,154 | 114,360 | (1,206 | ) | 115,989 | (2,835 | ) | ||||||||||||||
Net occupancy expenses | 25,691 | 27,039 | (1,348 | ) | 23,473 | 2,218 | |||||||||||||||
Equipment expenses | 11,782 | 11,922 | (140 | ) | 11,950 | (168 | ) | ||||||||||||||
Other taxes | 13,724 | 13,663 | 61 | 11,586 | 2,138 | ||||||||||||||||
Professional fees | 69,792 | 76,780 | (6,988 | ) | 70,497 | (705 | ) | ||||||||||||||
Communications | 6,934 | 6,260 | 674 | 6,832 | 102 | ||||||||||||||||
Business promotion | 11,682 | 17,015 | (5,333 | ) | 12,917 | (1,235 | ) | ||||||||||||||
FDIC deposit insurance | 11,973 | 15,630 | (3,657 | ) | 9,280 | 2,693 | |||||||||||||||
Other real estate owned (OREO) expenses | 6,187 | 10,558 | (4,371 | ) | 46,741 | (40,554 | ) | ||||||||||||||
Credit and debit card processing, volume, interchange and other expenses | 5,445 | 5,409 | 36 | 4,975 | 470 | ||||||||||||||||
Other operating expenses | 17,919 | 21,587 | (3,668 | ) | 16,990 | 929 | |||||||||||||||
Amortization of intangibles | 2,504 | 2,480 | 24 | 2,468 | 36 | ||||||||||||||||
Total operating expenses | 296,787 | 322,703 | (25,916 | ) | 333,698 | (36,911 | ) | ||||||||||||||
Income (loss) before income tax | 109,673 | 188,193 | (78,520 | ) | (177,184 | ) | 286,857 | ||||||||||||||
Income tax expense (benefit) | 23,264 | 25,162 | (1,898 | ) | (56,877 | ) | 80,141 | ||||||||||||||
Net income (loss) | $ | 86,409 | $ | 163,031 | $ | (76,622 | ) | $ | (120,307 | ) | $ | 206,716 | |||||||||
Net income (loss) applicable to common stock | $ | 85,478 | $ | 162,100 | $ | (76,622 | ) | $ | (121,237 | ) | $ | 206,715 | |||||||||
Net income (loss) per common share - basic | $ | 0.83 | $ | 1.58 | $ | (0.75 | ) | $ | (1.18 | ) | $ | 2.01 | |||||||||
Net income (loss) per common share - diluted | $ | 0.83 | $ | 1.57 | $ | (0.74 | ) | $ | (1.18 | ) | $ | 2.01 | |||||||||
Popular, Inc. | ||||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | ||||||||||||||||||
Table C - Consolidated Statement of Financial Condition | ||||||||||||||||||
(Unaudited) | ||||||||||||||||||
Variance | ||||||||||||||||||
Q1 2014 vs. | ||||||||||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | Q4 2013 | ||||||||||||||
Assets: | ||||||||||||||||||
Cash and due from banks | $ | 387,917 | $ | 423,211 | $ | 242,290 | $ | (35,294 | ) | |||||||||
Money market investments | 1,622,433 | 858,453 | 1,344,244 | 763,980 | ||||||||||||||
Trading account securities, at fair value | 359,247 | 339,743 | 299,773 | 19,504 | ||||||||||||||
Investment securities available-for-sale, at fair value | 5,768,890 | 5,294,800 | 5,321,231 | 474,090 | ||||||||||||||
Investment securities held-to-maturity, at amortized cost | 139,019 | 140,496 | 141,518 | (1,477 | ) | |||||||||||||
Other investment securities, at lower of cost or realizable value | 166,556 | 181,752 | 198,577 | (15,196 | ) | |||||||||||||
Loans held-for-sale, at lower of cost or fair value | 94,877 | 110,426 | 201,495 | (15,549 | ) | |||||||||||||
Loans held-in-portfolio: | ||||||||||||||||||
Loans not covered under loss sharing agreements with the FDIC | 21,703,050 | 21,704,010 | 21,729,882 | (960 | ) | |||||||||||||
Loans covered under loss sharing agreements with the FDIC | 2,870,054 | 2,984,427 | 3,362,446 | (114,373 | ) | |||||||||||||
Less: Unearned income | 91,273 | 92,144 | 96,137 | (871 | ) | |||||||||||||
Allowance for loan losses | 640,348 | 640,555 | 683,368 | (207 | ) | |||||||||||||
Total loans held-in-portfolio, net | 23,841,483 | 23,955,738 | 24,312,823 | (114,255 | ) | |||||||||||||
FDIC loss share asset | 833,721 | 948,608 | 1,380,592 | (114,887 | ) | |||||||||||||
Premises and equipment, net | 513,855 | 519,516 | 532,785 | (5,661 | ) | |||||||||||||
Other real estate not covered under loss sharing agreements with the FDIC | 136,965 | 135,501 | 154,699 | 1,464 | ||||||||||||||
Other real estate covered under loss sharing agreements with the FDIC | 158,747 | 168,007 | 172,378 | (9,260 | ) | |||||||||||||
Accrued income receivable | 125,895 | 131,536 | 135,542 | (5,641 | ) | |||||||||||||
Mortgage servicing assets, at fair value | 156,529 | 161,099 | 153,949 | (4,570 | ) | |||||||||||||
Other assets | 1,747,646 | 1,687,558 | 1,651,234 | 60,088 | ||||||||||||||
Goodwill | 647,757 | 647,757 | 647,757 | - | ||||||||||||||
Other intangible assets | 42,625 | 45,132 | 51,827 | (2,507 | ) | |||||||||||||
Total assets | $ | 36,744,162 | $ | 35,749,333 | $ | 36,942,714 | $ | 994,829 | ||||||||||
Liabilities and Stockholders’ Equity: | ||||||||||||||||||
Liabilities: | ||||||||||||||||||
Deposits: | ||||||||||||||||||
Non-interest bearing | $ | 6,326,596 | $ | 5,922,682 | $ | 5,613,701 | $ | 403,914 | ||||||||||
Interest bearing | 20,939,055 | 20,788,463 | 21,399,516 | 150,592 | ||||||||||||||
Total deposits | 27,265,651 | 26,711,145 | 27,013,217 | 554,506 | ||||||||||||||
Federal funds purchased and assets sold under agreements to repurchase | 2,208,213 | 1,659,292 | 2,265,675 | 548,921 | ||||||||||||||
Other short-term borrowings | 1,200 | 401,200 | 951,200 | (400,000 | ) | |||||||||||||
Notes payable | 1,506,408 | 1,584,754 | 1,752,469 | (78,346 | ) | |||||||||||||
Other liabilities | 1,016,943 | 766,792 | 989,010 | 250,151 | ||||||||||||||
Total liabilities | 31,998,415 | 31,123,183 | 32,971,571 | 875,232 | ||||||||||||||
Stockholders’ equity: | ||||||||||||||||||
Preferred stock | 50,160 | 50,160 | 50,160 | - | ||||||||||||||
Common stock | 1,035 | 1,034 | 1,033 | 1 | ||||||||||||||
Surplus | 4,171,817 | 4,170,152 | 4,151,838 | 1,665 | ||||||||||||||
Retained earnings (accumulated deficit) | 679,908 | 594,430 | (109,411 | ) | 85,478 | |||||||||||||
Treasury stock | (898 | ) | (881 | ) | (469 | ) | (17 | ) | ||||||||||
Accumulated other comprehensive loss | (156,275 | ) | (188,745 | ) | (122,008 | ) | 32,470 | |||||||||||
Total stockholders’ equity | 4,745,747 | 4,626,150 | 3,971,143 | 119,597 | ||||||||||||||
Total liabilities and stockholders’ equity | $ | 36,744,162 | $ | 35,749,333 | $ | 36,942,714 | $ | 994,829 | ||||||||||
Popular, Inc. | |||||||||||||||||||||||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||||||||||||||||||||||||||
Table D - Consolidated Average Balances and Yield / Rate Analysis - QUARTER | |||||||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | Variance | Variance | |||||||||||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | 31-Mar-13 | Q1 2014 vs. Q4 2013 | Q1 2014 vs. Q1 2013 | |||||||||||||||||||||||||||||||||
($ amounts in millions; yields not on a taxable equivalent basis) |
Average balance |
Income/ |
Yield/ |
Average balance |
Income/ |
Yield/ |
Average balance |
Income/ |
Yield/ |
Average balance |
Income/ |
Yield/ |
Average balance |
Income/ |
Yield/ |
||||||||||||||||||||||
Assets: | |||||||||||||||||||||||||||||||||||||
Interest earning assets: | |||||||||||||||||||||||||||||||||||||
Money market, trading and investment securities | $7,566 | $41.4 | 2.19 | % | $7,038 | $40.5 | 2.30 | % | $6,971 | $44.3 | 2.55 | % | $528 | $0.9 | (0.11) | % | $595 | ($2.9) | (0.36) | % | |||||||||||||||||
Loans not covered under loss sharing agreements with the FDIC: | |||||||||||||||||||||||||||||||||||||
Commercial | 10,211 | 122.8 | 4.88 | 10,097 | 122.6 | 4.82 | 10,078 | 119.8 | 4.82 | 114 | 0.2 | 0.06 | 133 | 3.0 | 0.06 | ||||||||||||||||||||||
Construction | 191 | 4.9 | 10.40 | 291 | 4.8 | 6.58 | 369 | 3.6 | 3.92 | (100) | 0.1 | 3.82 | (178) | 1.3 | 6.48 | ||||||||||||||||||||||
Mortgage | 6,691 | 86.9 | 5.20 | 6,688 | 87.1 | 5.21 | 6,410 | 83.2 | 5.19 | 3 | (0.2) | (0.01) | 281 | 3.7 | 0.01 | ||||||||||||||||||||||
Consumer | 3,925 | 95.9 | 9.90 | 3,906 | 96.7 | 9.82 | 3,853 | 95.8 | 10.08 | 19 | (0.8) | 0.08 | 72 | 0.1 | (0.18) | ||||||||||||||||||||||
Lease financing | 544 | 10.3 | 7.57 | 538 | 10.5 | 7.79 | 543 | 11.3 | 8.36 | 6 | (0.2) | (0.22) | 1 | (1.0) | (0.79) | ||||||||||||||||||||||
Total loans not covered under loss sharing agreements with the FDIC | 21,562 | 320.8 | 6.01 | 21,520 | 321.7 | 5.95 | 21,253 | 313.7 | 5.96 | 42 | (0.9) | 0.06 | 309 | 7.1 | 0.05 | ||||||||||||||||||||||
Loans covered under loss sharing agreements with the FDIC | 2,934 | 81.1 | 11.18 | 3,017 | 86.8 | 11.43 | 3,514 | 72.2 | 8.31 | (83) | (5.7) | (0.25) | (580) | 8.9 | 2.87 | ||||||||||||||||||||||
Total loans | 24,496 | 401.9 | 6.63 | 24,537 | 408.5 | 6.62 | 24,767 | 385.9 | 6.29 | (41) | (6.6) | 0.01 | (271) | 16.0 | 0.34 | ||||||||||||||||||||||
Total interest earning assets | 32,062 | $443.3 | 5.58 | % | 31,575 | $449.0 | 5.66 | % | 31,738 | $430.2 | 5.47 | % | 487 | ($5.7) | (0.08) | % | 324 | $13.1 | 0.11 | % | |||||||||||||||||
Allowance for loan losses | (647) | (632) | (659) | (15) | 12 | ||||||||||||||||||||||||||||||||
Other non-interest earning assets | 4,781 | 5,092 | 5,283 | (311) | (502) | ||||||||||||||||||||||||||||||||
Total average assets | $36,196 | $36,035 | $36,362 | $161 | ($166) | ||||||||||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | |||||||||||||||||||||||||||||||||||||
Interest bearing deposits: | |||||||||||||||||||||||||||||||||||||
NOW and money market | $5,730 | $4.4 | 0.31 | % | $5,653 | $4.4 | 0.31 | % | $5,696 | $5.8 | 0.41 | % | $77 | $0.0 | - | % | $34 | ($1.4) | (0.10) | % | |||||||||||||||||
Savings | 6,905 | 3.7 | 0.22 | 6,872 | 3.8 | 0.22 | 6,718 | 4.3 | 0.26 | 33 | (0.1) | - | 187 | (0.6) | (0.04) | ||||||||||||||||||||||
Time deposits | 8,122 | 21.3 | 1.07 | 8,381 | 23.2 | 1.10 | 8,832 | 28.2 | 1.30 | (259) | (1.9) | (0.03) | (710) | (6.9) | (0.23) | ||||||||||||||||||||||
Total interest bearing deposits | 20,757 | 29.4 | 0.57 | 20,906 | 31.4 | 0.60 | 21,246 | 38.3 | 0.73 | (149) | (2.0) | (0.03) | (489) | (8.9) | (0.16) | ||||||||||||||||||||||
Borrowings | 3,870 | 40.9 | 4.25 | 3,795 | 41.3 | 4.35 | 4,492 | 45.6 | 4.07 | 75 | (0.4) | (0.10) | (622) | (4.7) | 0.18 | ||||||||||||||||||||||
Total interest bearing liabilities | 24,627 | 70.3 | 1.15 | 24,701 | 72.7 | 1.17 | 25,738 | 83.9 | 1.32 | (74) | (2.4) | (0.02) | (1,111) | (13.6) | (0.17) | ||||||||||||||||||||||
Net interest spread | 4.43 | % | 4.49 | % | 4.15 | % | (0.06) | % | 0.28 | % | |||||||||||||||||||||||||||
Non-interest bearing deposits | 5,931 | 5,829 | 5,591 | 102 | 340 | ||||||||||||||||||||||||||||||||
Other liabilities | 899 | 1,046 | 1,074 | (147) | (175) | ||||||||||||||||||||||||||||||||
Stockholders' equity | 4,739 | 4,459 | 3,959 | 280 | 780 | ||||||||||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $36,196 | $36,035 | $36,362 | $161 | ($166) | ||||||||||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $373.0 | 4.70 | % | $376.3 | 4.74 | % | $346.3 | 4.40 | % | ($3.3) | (0.04) | % | $26.7 | 0.30 | % | ||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||||||||||
Table F - Mortgage Banking Activities and Other Service Fees | |||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||
Mortgage Banking Activities | Variance | ||||||||||||||||||||
Quarters ended | Q1 2014 vs. | Q1 2014 vs. | |||||||||||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | Q4 2013 | Q1 2013 | ||||||||||||||||
Mortgage servicing fees, net of fair value adjustments: | |||||||||||||||||||||
Mortgage servicing fees | $ | 10,751 | $ | 11,371 | $ | 11,246 | $ | (620 | ) | $ | (495 | ) | |||||||||
Mortgage servicing rights fair value adjustments | (8,096 | ) | (4,541 | ) | (5,615 | ) | (3,555 | ) | (2,481 | ) | |||||||||||
Total mortgage servicing fees, net of fair value adjustments | 2,655 | 6,830 | 5,631 | (4,175 | ) | (2,976 | ) | ||||||||||||||
Net gain on sale of loans, including valuation on loans held-for-sale | 7,176 | 9,751 | 13,760 | (2,575 | ) | (6,584 | ) | ||||||||||||||
Trading account (loss) profit: | |||||||||||||||||||||
Unrealized (losses) gains on outstanding derivative positions | (760 | ) | 1,011 | (22 | ) | (1,771 | ) | (738 | ) | ||||||||||||
Realized (losses) gains on closed derivative positions | (5,390 | ) | (3,200 | ) | 931 | (2,190 | ) | (6,321 | ) | ||||||||||||
Total trading account profit | (6,150 | ) | (2,189 | ) | 909 | (3,961 | ) | (7,059 | ) | ||||||||||||
Total mortgage banking activities | $ | 3,681 | $ | 14,392 | $ | 20,300 | $ | (10,711 | ) | $ | (16,619 | ) | |||||||||
Other Service Fees | Variance | ||||||||||||||||||||
Quarters ended | Q1 2014 vs. | Q1 2014 vs. | |||||||||||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | Q4 2013 | Q1 2013 | ||||||||||||||||
Other service fees: | |||||||||||||||||||||
Debit card fees | $ | 10,875 | $ | 11,124 | $ | 10,397 | $ | (249 | ) | $ | 478 | ||||||||||
Insurance fees | 12,296 | 17,530 | 12,073 | (5,234 | ) | 223 | |||||||||||||||
Credit card fees | 16,221 | 17,328 | 15,685 | (1,107 | ) | 536 | |||||||||||||||
Sale and administration of investment products | 6,457 | 7,331 | 8,717 | (874 | ) | (2,260 | ) | ||||||||||||||
Trust fees | 4,463 | 4,525 | 4,458 | (62 | ) | 5 | |||||||||||||||
Other fees | 3,731 | 3,728 | 4,763 | 3 | (1,032 | ) | |||||||||||||||
Total other service fees | $ | 54,043 | $ | 61,566 | $ | 56,093 | $ | (7,523 | ) | $ | (2,050 | ) | |||||||||
Popular, Inc. | |||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||||||
Table G - Loans and Deposits | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Loans - Ending Balances | |||||||||||||||||
Variance | |||||||||||||||||
Q1 2014 vs. | Q1 2014 vs. | ||||||||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | Q4 2013 | Q1 2013 | ||||||||||||
Loans not covered under FDIC loss sharing agreements: | |||||||||||||||||
Commercial | $ | 10,014,721 | $ | 10,037,184 | $ | 9,750,428 | $ | (22,463 | ) | $ | 264,293 | ||||||
Construction | 176,766 | 206,084 | 271,498 | (29,318 | ) | (94,732 | ) | ||||||||||
Legacy [1] | 197,164 | 211,135 | 352,512 | (13,971 | ) | (155,348 | ) | ||||||||||
Lease financing | 546,880 | 543,761 | 543,572 | 3,119 | 3,308 | ||||||||||||
Mortgage | 6,669,376 | 6,681,476 | 6,873,910 | (12,100 | ) | (204,534 | ) | ||||||||||
Consumer | 4,006,870 | 3,932,226 | 3,841,825 | 74,644 | 165,045 | ||||||||||||
Total non-covered loans held-in-portfolio | $ | 21,611,777 | $ | 21,611,866 | $ | 21,633,745 | $ | (89 | ) | $ | (21,968 | ) | |||||
Loans covered under FDIC loss sharing agreements | 2,870,054 | 2,984,427 | 3,362,446 | (114,373 | ) | (492,392 | ) | ||||||||||
Total loans held-in-portfolio | $ | 24,481,831 | $ | 24,596,293 | $ | 24,996,191 | $ | (114,462 | ) | $ | (514,360 | ) | |||||
Loans held-for-sale: | |||||||||||||||||
Commercial | $ | - | $ | 603 | $ | - | $ | (603 | ) | $ | - | ||||||
Legacy [1] | - | - | 1,681 | - | (1,681 | ) | |||||||||||
Mortgage | 94,877 | 109,823 | 199,814 | (14,946 | ) | (104,937 | ) | ||||||||||
Total loans held-for-sale | $ | 94,877 | $ | 110,426 | $ | 201,495 | $ | (15,549 | ) | $ | (106,618 | ) | |||||
Total loans | $ | 24,576,708 | $ | 24,706,719 | $ | 25,197,686 | $ | (130,011 | ) | $ | (620,978 | ) | |||||
[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 | |||||||||||||||||
Q1 2014 vs. | Q1 2014 vs. | ||||||||||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | Q4 2013 | Q1 2013 | ||||||||||||
Demand deposits [1] | $ | 7,020,844 | $ | 6,590,963 | $ | 6,265,796 | $ | 429,881 | $ | 755,048 | |||||||
Savings, NOW and money market deposits (non-brokered) | 11,420,642 | 11,255,309 | 11,357,130 | 165,333 | 63,512 | ||||||||||||
Savings, NOW and money market deposits (brokered) | 581,562 | 553,521 | 498,833 | 28,041 | 82,729 | ||||||||||||
Time deposits (non-brokered) | 6,474,430 | 6,478,103 | 6,427,320 | (3,673 | ) | 47,110 | |||||||||||
Time deposits (brokered CDs) | 1,768,173 | 1,833,249 | 2,464,138 | (65,076 | ) | (695,965 | ) | ||||||||||
Total deposits | $ | 27,265,651 | $ | 26,711,145 | $ | 27,013,217 | $ | 554,506 | $ | 252,434 | |||||||
[1] Includes interest and non-interest demand bearing deposits. | |||||||||||||||||
Popular, Inc. | |||||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||||||||
Table H - Non-Performing Assets | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Variance | |||||||||||||||||||
(Dollars in thousands) | 31-Mar-14 |
As a % of |
31-Dec-13 |
As a % of |
31-Mar-13 |
As a % of |
Q1 2014 vs. |
Q1 2014 vs. |
|||||||||||
Non-accrual loans: | |||||||||||||||||||
Commercial | $ 306,929 | 3.1 | % | $ 279,053 | 2.8 | % | $ 320,787 | 3.3 | % | $ 27,876 | $ (13,858) | ||||||||
Construction | 22,464 | 12.7 | 23,771 | 11.5 | 50,920 | 18.8 | (1,307) | (28,456) | |||||||||||
Legacy [1] | 11,608 | 5.9 | 15,050 | 7.1 | 35,830 | 10.2 | (3,442) | (24,222) | |||||||||||
Lease financing | 3,050 | 0.6 | 3,495 | 0.6 | 4,005 | 0.7 | (445) | (955) | |||||||||||
Mortgage | 252,021 | 3.8 | 232,681 | 3.5 | 600,724 | 8.7 | 19,340 | (348,703) | |||||||||||
Consumer | 39,262 | 1.0 | 43,898 | 1.1 | 38,342 | 1.0 | (4,636) | 920 | |||||||||||
Total non-performing loans held-in-portfolio, excluding covered loans |
|||||||||||||||||||
635,334 | 2.9 | % | 597,948 | 2.8 | % | 1,050,608 | 4.9 | % | 37,386 | (415,274) | |||||||||
Non-performing loans held-for-sale [2] | 789 | 1,092 | 17,463 | (303) | (16,674) | ||||||||||||||
Other real estate owned (“OREO”), excluding covered OREO | |||||||||||||||||||
136,965 | 135,501 | 154,699 | 1,464 | (17,734) | |||||||||||||||
Total non-performing assets, excluding covered assets | |||||||||||||||||||
773,088 | 734,541 | 1,222,770 | 38,547 | (449,682) | |||||||||||||||
Covered loans and OREO | 182,659 | 197,388 | 198,870 | (14,729) | (16,211) | ||||||||||||||
Total non-performing assets | $ 955,747 | $ 931,929 | $ 1,421,640 | $ 23,818 | $ (465,893) | ||||||||||||||
Accruing loans past due 90 days or more [3] | $ 409,460 | $ 418,028 | $ 410,065 | $ (8,568) | $ (605) | ||||||||||||||
Ratios excluding covered loans: | |||||||||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | |||||||||||||||||||
2.94 |
% |
|
2.77 |
% |
|
4.86 |
% |
|
|||||||||||
Allowance for loan losses to loans held-in-portfolio | |||||||||||||||||||
2.51 | 2.49 | 2.70 | |||||||||||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale |
|||||||||||||||||||
85.40 | 90.05 | 55.54 | |||||||||||||||||
Ratios including covered loans: | |||||||||||||||||||
Non-performing assets to total assets | 2.60 |
% |
|
2.61 |
% |
|
3.85 |
% |
|
||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | |||||||||||||||||||
2.69 | 2.55 | 4.31 | |||||||||||||||||
Allowance for loan losses to loans held-in-portfolio | |||||||||||||||||||
2.62 | 2.60 | 2.73 | |||||||||||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale | |||||||||||||||||||
97.13 | 102.11 | 63.45 | |||||||||||||||||
[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 March 31, 2014 consisted of $789 thousand in mortgage loans (December 31, 2013 - $603 thousand in commercial loans and $489 thousand in mortgage loans; March 31, 2013 - $1 million in legacy loans and $16 million in mortgage loans). | |||||||||||||||||||
[3] It is the Corporation’s policy to report delinquent residential mortgage loans insured by FHA or guaranteed by the VA as accruing loans past due 90 days or more as opposed to nonperforming since the principal repayment is insured. These balances include $117 million of residential mortgage loans insured by FHA or guaranteed by the VA that are no longer accruing interest as of March 31, 2014 (December 31, 2013 - $115 million; March 31, 2013 - $99 million). | |||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||||||||||||||
Table I - Activity in Non-Performing Loans | |||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
Commercial loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 186,097 | $ | 92,956 | $ | 279,053 | $ | 204,569 | $ | 111,471 | $ | 316,040 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 86,045 | 17,156 | 103,201 | 31,649 | 7,905 | 39,554 | |||||||||||||||||||
Advances on existing non-performing loans | - | 6 | 6 | - | 5 | 5 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (3,700 | ) | - | (3,700 | ) | (4,800 | ) | (505 | ) | (5,305 | ) | ||||||||||||||
Non-performing loans charged-off | (10,278 | ) | (4,092 | ) | (14,370 | ) | (21,548 | ) | (10,359 | ) | (31,907 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (12,233 | ) | (14,934 | ) | (27,167 | ) | (23,773 | ) | (14,682 | ) | (38,455 | ) | |||||||||||||
Loans transferred to held-for-sale | - | (30,094 | ) | (30,094 | ) | - | (879 | ) | (879 | ) | |||||||||||||||
Ending balance NPLs | $ | 245,931 | $ | 60,998 | $ | 306,929 | $ | 186,097 | $ | 92,956 | $ | 279,053 | |||||||||||||
Construction loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 18,108 | $ | 5,663 | $ | 23,771 | $ | 23,019 | $ | 5,763 | $ | 28,782 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 7,960 | - | 7,960 | - | - | - | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans charged-off | (416 | ) | - | (416 | ) | (1,511 | ) | - | (1,511 | ) | |||||||||||||||
Loans returned to accrual status / loan collections | (3,188 | ) | (5,663 | ) | (8,851 | ) | (3,400 | ) | (100 | ) | (3,500 | ) | |||||||||||||
Ending balance NPLs | $ | 22,464 | $ | - | $ | 22,464 | $ | 18,108 | $ | 5,663 | $ | 23,771 | |||||||||||||
Mortgage loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 206,389 | $ | 26,292 | $ | 232,681 | $ | 177,835 | $ | 25,373 | $ | 203,208 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 89,142 | 3,920 | 93,062 | 94,721 | 5,593 | 100,314 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (1,751 | ) | (1,195 | ) | (2,946 | ) | (3,691 | ) | (710 | ) | (4,401 | ) | |||||||||||||
Non-performing loans charged-off | (6,693 | ) | (867 | ) | (7,560 | ) | (5,787 | ) | (825 | ) | (6,612 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (57,286 | ) | (5,930 | ) | (63,216 | ) | (56,689 | ) | (3,139 | ) | (59,828 | ) | |||||||||||||
Ending balance NPLs | $ | 229,801 | $ | 22,220 | $ | 252,021 | $ | 206,389 | $ | 26,292 | $ | 232,681 | |||||||||||||
Legacy loans held-in-portfolio: | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | - | $ | 15,050 | $ | 15,050 | $ | - | $ | 24,206 | $ | 24,206 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | - | 1,738 | 1,738 | - | 2,449 | 2,449 | |||||||||||||||||||
Advances on existing non-performing loans | - | 5 | 5 | - | 45 | 45 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans charged-off | - | (2,568 | ) | (2,568 | ) | - | (3,740 | ) | (3,740 | ) | |||||||||||||||
Loans returned to accrual status / loan collections | - | (2,617 | ) | (2,617 | ) | - | (7,910 | ) | (7,910 | ) | |||||||||||||||
Ending balance NPLs | $ | - | $ | 11,608 | $ | 11,608 | $ | - | $ | 15,050 | $ | 15,050 | |||||||||||||
Total non-performing loans held-in-portfolio (excluding consumer loans): | |||||||||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | ||||||||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||||||||
Beginning balance NPLs | $ | 410,594 | $ | 139,961 | $ | 550,555 | $ | 405,423 | $ | 166,813 | $ | 572,236 | |||||||||||||
Plus: | |||||||||||||||||||||||||
New non-performing loans | 183,147 | 22,814 | 205,961 | 126,370 | 15,947 | 142,317 | |||||||||||||||||||
Advances on existing non-performing loans | - | 11 | 11 | - | 50 | 50 | |||||||||||||||||||
Less: | |||||||||||||||||||||||||
Non-performing loans transferred to OREO | (5,451 | ) | (1,195 | ) | (6,646 | ) | (8,491 | ) | (1,215 | ) | (9,706 | ) | |||||||||||||
Non-performing loans charged-off | (17,387 | ) | (7,527 | ) | (24,914 | ) | (28,846 | ) | (14,924 | ) | (43,770 | ) | |||||||||||||
Loans returned to accrual status / loan collections | (72,707 | ) | (29,144 | ) | (101,851 | ) | (83,862 | ) | (25,831 | ) | (109,693 | ) | |||||||||||||
Loans transferred to held-for-sale | - | (30,094 | ) | (30,094 | ) | - | (879 | ) | (879 | ) | |||||||||||||||
Ending balance NPLs | $ | 498,196 | $ | 94,826 | $ | 593,022 | $ | 410,594 | $ | 139,961 | $ | 550,555 | |||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | ||||||||||||||||||||||||||||||||||||
Table J - Allowance for Credit Losses, Net Charge-offs and Related Ratios | ||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | ||||||||||||||||||||||||||||||||||
31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||||||||||||||||||||||||||||||||
(Dollars in thousands) |
Non-covered |
Covered |
Total |
Non-covered |
Covered |
Total |
Non-covered |
Covered |
Total | |||||||||||||||||||||||||||
Balance at beginning of period | $ | 538,463 | $ | 102,092 | $ | 640,555 | $ | 526,100 | $ | 116,828 | $ | 642,928 | $ | 621,701 | $ | 108,906 | $ | 730,607 | ||||||||||||||||||
Provision for loan losses | 47,358 | 25,714 | 73,072 | 47,729 | 8,907 | 56,636 | 206,300 | 17,556 | 223,856 | |||||||||||||||||||||||||||
585,821 | 127,806 | 713,627 | 573,829 | 125,735 | 699,564 | 828,001 | 126,462 | 954,463 | ||||||||||||||||||||||||||||
Net loans charged-off (recovered): | ||||||||||||||||||||||||||||||||||||
BPPR | ||||||||||||||||||||||||||||||||||||
Commercial | 15,173 | 7,648 | 22,821 | 15,177 | 13,433 | 28,610 | 24,311 | 10,535 | 34,846 | |||||||||||||||||||||||||||
Construction | (1,378 | ) | 21,092 | 19,714 | (1,796 | ) | 6,067 | 4,271 | 355 | 9,445 | 9,800 | |||||||||||||||||||||||||
Lease financing | 656 | - | 656 | 838 | - | 838 | 984 | - | 984 | |||||||||||||||||||||||||||
Mortgage | 8,516 | 1,656 | 10,172 | 6,981 | 4,729 | 11,710 | 16,773 | 2,051 | 18,824 | |||||||||||||||||||||||||||
Consumer | 22,983 | (363 | ) | 22,620 | 14,056 | (586 | ) | 13,470 | 20,001 | 4,564 | 24,565 | |||||||||||||||||||||||||
Total BPPR | 45,950 | 30,033 | 75,983 | 35,256 | 23,643 | 58,899 | 62,424 | 26,595 | 89,019 | |||||||||||||||||||||||||||
BPNA | ||||||||||||||||||||||||||||||||||||
Commercial | (3,691 | ) | - | (3,691 | ) | 159 | - | 159 | 8,104 | - | 8,104 | |||||||||||||||||||||||||
Construction | (176 | ) | - | (176 | ) | - | - | - | - | - | - | |||||||||||||||||||||||||
Legacy [1] | (4,882 | ) | - | (4,882 | ) | (5,118 | ) | - | (5,118 | ) | 1,886 | - | 1,886 | |||||||||||||||||||||||
Mortgage | 870 | - | 870 | 660 | - | 660 | 2,790 | - | 2,790 | |||||||||||||||||||||||||||
Consumer | 5,175 | - | 5,175 | 4,409 | - | 4,409 | 6,153 | - | 6,153 | |||||||||||||||||||||||||||
Total BPNA | (2,704 | ) | - | (2,704 | ) | 110 | - | 110 | 18,933 | - | 18,933 | |||||||||||||||||||||||||
Total loans charged-off (recovered) - Popular, Inc. | 43,246 | 30,033 | 73,279 | 35,366 | 23,643 | 59,009 | 81,357 | 26,595 | 107,952 | |||||||||||||||||||||||||||
Net write-downs [3] | - | - | - | - | - | - | (163,143 | ) | - | (163,143 | ) | |||||||||||||||||||||||||
Balance at end of period | $ | 542,575 | $ | 97,773 | $ | 640,348 | $ | 538,463 | $ | 102,092 | $ | 640,555 | $ | 583,501 | $ | 99,867 |
$ |
683,368 | ||||||||||||||||||
POPULAR, INC. | ||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 0.80 | % | 1.20 | % | 0.66 | % | 0.97 | % | 1.55 | % | 1.76 | % | ||||||||||||||||||||||||
Provision for loan losses to net charge-offs [2] | 1.10 | x | 1.00 | x | 1.35 | x | 0.96 | x | 0.71 | x | 0.70 | x | ||||||||||||||||||||||||
BPPR | ||||||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 1.16 | % | 1.62 | % | 0.90 | % | 1.26 | % | 1.64 | % | 1.90 | % | ||||||||||||||||||||||||
Provision for loan losses to net charge-offs [2] | 1.17 | x | 1.05 | x | 1.78 | x | 1.22 | x | 0.89 | x | 0.82 | x | ||||||||||||||||||||||||
BPNA | ||||||||||||||||||||||||||||||||||||
Annualized net charge-offs (recoveries) to average loans held-in-portfolio | (0.19) | % | 0.01 | % | 1.33 | % | ||||||||||||||||||||||||||||||
Provision for loan losses to net charge-offs | N.M. | N.M. | 0.11 | 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 March 31, 2013. | ||||||||||||||||||||||||||||||||||||
[3] Net write-downs for the quarter ended March 31, 2013 are related to loans sold. |
||||||||||||||||||||||||||||||||||||
N.M. - Not meaningful. |
||||||||||||||||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | ||||||||||||||||
Table K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED | ||||||||||||||||
(Unaudited) | ||||||||||||||||
31-Mar-14 | ||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage |
Lease |
Consumer | Total | [2] | ||||||||
Specific ALLL | $ 30,892 | $ 243 | $ - | $ 53,916 | $ 672 | $ 29,413 | $ 115,136 | |||||||||
Impaired loans | [1] | $ 334,975 | $ 22,011 | $ 3,710 | $ 458,513 | $ 2,455 | $ 124,836 | $ 946,500 | ||||||||
Specific ALLL to impaired loans | [1] | 9.22 | % | 1.10 | % | - | % | 11.76 | % | 27.37 | % | 23.56 | % | 12.16 | % | |
General ALLL | $ 141,122 | $ 5,059 | $ 13,272 | $ 109,047 | $ 9,811 | $ 149,128 | $ 427,439 | |||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $ 9,679,746 | $ 154,755 | $ 193,454 | $ 6,210,863 | $ 544,425 | $ 3,882,034 | $ 20,665,277 | ||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 1.46 | % | 3.27 | % | 6.86 | % | 1.76 | % | 1.80 | % | 3.84 | % | 2.07 | % | |
Total ALLL | $ 172,014 | $ 5,302 | $ 13,272 | $ 162,963 | $ 10,483 | $ 178,541 | $ 542,575 | |||||||||
Total non-covered loans held-in-portfolio | [1] | $ 10,014,721 | $ 176,766 | $ 197,164 | $ 6,669,376 | $ 546,880 | $ 4,006,870 | $ 21,611,777 | ||||||||
ALLL to loans held-in-portfolio | [1] | 1.72 | % | 3.00 | % | 6.73 | % | 2.44 | % | 1.92 | % | 4.46 | % | 2.51 | % | |
[1] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. | ||||||||||||||||
[2] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. As of March 31, 2014 the general allowance on the covered loans amounted to $97.7 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. | ||||||||||||||||
31-Dec-13 | ||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage |
Lease |
Consumer | Total | [2] | ||||||||
Specific ALLL | $ 16,409 | $ 177 | $ - | $ 55,667 | $ 1,053 | $ 30,200 | $ 103,506 | |||||||||
Impaired loans | [1] | $ 297,516 | $ 22,486 | $ 6,045 | $ 452,073 | $ 2,893 | $ 127,703 | $ 908,716 | ||||||||
Specific ALLL to impaired loans | [1] | 5.52 | % | 0.79 | % | - | % | 12.31 | % | 36.40 | % | 23.65 | % | 11.39 | % | |
General ALLL | $ 158,573 | $ 5,165 | $ 13,704 | $ 101,262 | $ 9,569 | $ 146,684 | $ 434,957 | |||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $ 9,739,669 | $ 183,598 | $ 205,090 | $ 6,229,403 | $ 540,868 | $ 3,804,523 | $ 20,703,151 | ||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 1.63 | % | 2.81 | % | 6.68 | % | 1.63 | % | 1.77 | % | 3.86 | % | 2.10 | % | |
Total ALLL | $ 174,982 | $ 5,342 | $ 13,704 | $ 156,929 | $ 10,622 | $ 176,884 | $ 538,463 | |||||||||
Total non-covered loans held-in-portfolio | [1] | $ 10,037,185 | $ 206,084 | $ 211,135 | $ 6,681,476 | $ 543,761 | $ 3,932,226 | $ 21,611,867 | ||||||||
ALLL to loans held-in-portfolio | [1] | 1.74 | % | 2.59 | % | 6.49 | % | 2.35 | % | 1.95 | % | 4.50 | % | 2.49 | % | |
[1] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. | ||||||||||||||||
[2] Excludes covered loans acquired on the Westernbank FDIC-assisted transaction. As of December 31, 2013 the general allowance on the covered loans amounted to $101.8 million, while the specific reserve amounted to $0.3 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 |
Consumer | Total | ||||||||||
Specific ALLL | $ 14,483 | $ 66 | $ - | $ (1,751) | $ (381) | $ (787) | $ 11,630 | ||||||||||
Impaired loans | $ 37,459 | $ (475) | $ (2,335) | $ 6,440 | $ (438) | $ (2,867) | $ 37,784 | ||||||||||
General ALLL | $ (17,451) | $ (106) | $ (432) | $ 7,785 | $ 242 | $ 2,444 | $ (7,518) | ||||||||||
Loans held-in-portfolio, excluding impaired loans | $ (59,923) | $ (28,843) | $ (11,636) | $ (18,540) | $ 3,557 | $ 77,511 | $ (37,874) | ||||||||||
Total ALLL | $ (2,968) | $ (40) | $ (432) | $ 6,034 | $ (139) | $ 1,657 | $ 4,112 | ||||||||||
Total non-covered loans held-in-portfolio | $ (22,464) | $ (29,318) | $ (13,971) | $ (12,100) | $ 3,119 | $ 74,644 | $ (90) | ||||||||||
Popular, Inc. | |||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||
Table L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS | |||||||||||||
(Unaudited) | |||||||||||||
31-Mar-14 | |||||||||||||
Puerto Rico | |||||||||||||
(In thousands) | Commercial | Construction | Mortgage |
Lease |
Consumer | Total | |||||||
Allowance for credit losses: | |||||||||||||
Specific ALLL non-covered loans | $ 30,892 | $ 243 | $ 36,322 | $ 672 | $ 29,170 | $ 97,299 | |||||||
General ALLL non-covered loans | 93,242 | 4,836 | 101,474 | 9,811 | 128,078 | 337,441 | |||||||
ALLL - non-covered loans | 124,134 | 5,079 | 137,796 | 10,483 | 157,248 | 434,740 | |||||||
Specific ALLL covered loans | - | - | - | - | - | - | |||||||
General ALLL covered loans | 38,589 | 15,966 | 38,848 | - | 4,370 | 97,773 | |||||||
ALLL - covered loans | 38,589 | 15,966 | 38,848 | - | 4,370 | 97,773 | |||||||
Total ALLL | $ 162,723 | $ 21,045 | $ 176,644 | $ 10,483 | $ 161,618 | $ 532,513 | |||||||
Loans held-in-portfolio: | |||||||||||||
Impaired non-covered loans | $ 304,531 | $ 22,011 | $ 406,053 | $ 2,455 | $ 122,291 | $ 857,341 | |||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 6,138,467 | 119,592 | 5,018,808 | 544,425 | 3,284,286 | 15,105,578 | |||||||
Non-covered loans held-in-portfolio | 6,442,998 | 141,603 | 5,424,861 | 546,880 | 3,406,577 | 15,962,919 | |||||||
Impaired covered loans | 5,540 | - | - | - | - | 5,540 | |||||||
Covered loans held-in-portfolio, excluding impaired loans | 1,786,145 | 127,444 | 907,069 | - | 43,856 | 2,864,514 | |||||||
Covered loans held-in-portfolio | 1,791,685 | 127,444 | 907,069 | - | 43,856 | 2,870,054 | |||||||
Total loans held-in-portfolio | $ 8,234,683 | $ 269,047 | $ 6,331,930 | $ 546,880 | $ 3,450,433 | $ 18,832,973 | |||||||
31-Dec-13 | |||||||||||||
Puerto Rico | |||||||||||||
(In thousands) | Commercial | Construction | Mortgage |
Lease |
Consumer | Total | |||||||
Allowance for credit losses: | |||||||||||||
Specific ALLL non-covered loans | $ 16,409 | $ 177 | $ 38,034 | $ 1,053 | $ 29,920 | $ 85,593 | |||||||
General ALLL non-covered loans | 111,741 | 4,918 | 92,296 | 9,569 | 122,658 | 341,182 | |||||||
ALLL - non-covered loans | 128,150 | 5,095 | 130,330 | 10,622 | 152,578 | 426,775 | |||||||
Specific ALLL covered loans | 153 | 140 | - | - | - | 293 | |||||||
General ALLL covered loans | 42,045 | 19,351 | 36,006 | - | 4,397 | 101,799 | |||||||
ALLL - covered loans | 42,198 | 19,491 | 36,006 | - | 4,397 | 102,092 | |||||||
Total ALLL | $ 170,348 | $ 24,586 | $ 166,336 | $ 10,622 | $ 156,975 | $ 528,867 | |||||||
Loans held-in-portfolio: | |||||||||||||
Impaired non-covered loans | $ 245,380 | $ 16,823 | $ 399,347 | $ 2,893 | $ 125,342 | $ 789,785 | |||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 6,220,210 | 144,348 | 5,001,332 | 540,868 | 3,191,296 | 15,098,054 | |||||||
Non-covered loans held-in-portfolio | 6,465,590 | 161,171 | 5,400,679 | 543,761 | 3,316,638 | 15,887,839 | |||||||
Impaired covered loans | 20,945 | - | - | - | - | 20,945 | |||||||
Covered loans held-in-portfolio, excluding impaired loans | 1,791,859 | 190,127 | 934,373 | - | 47,123 | 2,963,482 | |||||||
Covered loans held-in-portfolio | 1,812,804 | 190,127 | 934,373 | - | 47,123 | 2,984,427 | |||||||
Total loans held-in-portfolio | $ 8,278,394 | $ 351,298 | $ 6,335,052 | $ 543,761 | $ 3,363,761 | $ 18,872,266 | |||||||
Variance | |||||||||||||
(In thousands) | Commercial | Construction | Mortgage |
Lease |
Consumer | Total | |||||||
Allowance for credit losses: | |||||||||||||
Specific ALLL non-covered loans | $ 14,483 | $ 66 | $ (1,712) | $ (381) | $ (750) | $ 11,706 | |||||||
General ALLL non-covered loans | (18,499) | (82) | 9,178 | 242 | 5,420 | (3,741) | |||||||
ALLL - non-covered loans | (4,016) | (16) | 7,466 | (139) | 4,670 | 7,965 | |||||||
Specific ALLL covered loans | (153) | (140) | - | - | - | (293) | |||||||
General ALLL covered loans | (3,456) | (3,385) | 2,842 | - | (27) | (4,026) | |||||||
ALLL - covered loans | (3,609) | (3,525) | 2,842 | - | (27) | (4,319) | |||||||
Total ALLL | $ (7,625) | $ (3,541) | $ 10,308 | $ (139) | $ 4,643 | $ 3,646 | |||||||
Loans held-in-portfolio: | |||||||||||||
Impaired non-covered loans | $ 59,151 | $ 5,188 | $ 6,706 | $ (438) | $ (3,051) | $ 67,556 | |||||||
Non-covered loans held-in-portfolio, excluding impaired loans | (81,743) | (24,756) | 17,476 | 3,557 | 92,990 | 7,524 | |||||||
Non-covered loans held-in-portfolio | (22,592) | (19,568) | 24,182 | 3,119 | 89,939 | 75,080 | |||||||
Impaired covered loans | (15,405) | - | - | - | - | (15,405) | |||||||
Covered loans held-in-portfolio, excluding impaired loans | (5,714) | (62,683) | (27,304) | - | (3,267) | (98,968) | |||||||
Covered loans held-in-portfolio | (21,119) | (62,683) | (27,304) | - | (3,267) | (114,373) | |||||||
Total loans held-in-portfolio | $ (43,711) | $ (82,251) | $ (3,122) | $ 3,119 | $ 86,672 | $ (39,293) | |||||||
Popular, Inc. | |||||||||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||||||||
Table M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS | |||||||||||||
(Unaudited) | |||||||||||||
31-Mar-14 | |||||||||||||
U.S. Mainland | |||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||
Allowance for credit losses: | |||||||||||||
Specific ALLL | $ - | $ - | $ - | $ 17,594 | $ 243 | $ 17,837 | |||||||
General ALLL | 47,880 | 223 | 13,272 | 7,573 | 21,050 | 89,998 | |||||||
Total ALLL | $ 47,880 | $ 223 | $ 13,272 | $ 25,167 | $ 21,293 | $ 107,835 | |||||||
Loans held-in-portfolio: | |||||||||||||
Impaired loans | $ 30,444 | $ - | $ 3,710 | $ 52,460 | $ 2,545 | $ 89,159 | |||||||
Loans held-in-portfolio, excluding impaired loans | 3,541,279 | 35,163 | 193,454 | 1,192,055 | 597,748 | 5,559,699 | |||||||
Total loans held-in-portfolio | $ 3,571,723 | $ 35,163 | $ 197,164 | $ 1,244,515 | $ 600,293 | $ 5,648,858 | |||||||
31-Dec-13 | |||||||||||||
U.S. Mainland | |||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||
Allowance for credit losses: | |||||||||||||
Specific ALLL | $ - | $ - | $ - | $ 17,633 | $ 280 | $ 17,913 | |||||||
General ALLL | 46,832 | 247 | 13,704 | 8,966 | 24,026 | 93,775 | |||||||
Total ALLL | $ 46,832 | $ 247 | $ 13,704 | $ 26,599 | $ 24,306 | $ 111,688 | |||||||
Loans held-in-portfolio: | |||||||||||||
Impaired loans | $ 52,136 | $ 5,663 | $ 6,045 | $ 52,726 | $ 2,361 | $ 118,931 | |||||||
Loans held-in-portfolio, excluding impaired loans | 3,519,459 | 39,250 | 205,090 | 1,228,071 | 613,227 | 5,605,097 | |||||||
Total loans held-in-portfolio | $ 3,571,595 | $ 44,913 | $ 211,135 | $ 1,280,797 | $ 615,588 | $ 5,724,028 | |||||||
Variance | |||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||
Allowance for credit losses: | |||||||||||||
Specific ALLL | $ - | $ - | $ - | $ (39) | $ (37) | $ (76) | |||||||
General ALLL | 1,048 | (24) | (432) | (1,393) | (2,976) | (3,777) | |||||||
Total ALLL | $ 1,048 | $ (24) | $ (432) | $ (1,432) | $ (3,013) | $ (3,853) | |||||||
Loans held-in-portfolio: | |||||||||||||
Impaired loans | $ (21,692) | $ (5,663) | $ (2,335) | $ (266) | $ 184 | $ (29,772) | |||||||
Loans held-in-portfolio, excluding impaired loans | 21,820 | (4,087) | (11,636) | (36,016) | (15,479) | (45,398) | |||||||
Total loans held-in-portfolio | $ 128 | $ (9,750) | $ (13,971) | $ (36,282) | $ (15,295) | $ (75,170) | |||||||
Popular, Inc. | |||||||
Financial Supplement to First Quarter 2014 Earnings Release | |||||||
Table N - Reconciliation to GAAP Financial Measures | |||||||
(Unaudited) | |||||||
(In thousands, except share or per share information) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||
Total stockholders’ equity | $ 4,745,747 | $ 4,626,150 | $ 3,971,143 | ||||
Less: Preferred stock | (50,160) | (50,160) | (50,160) | ||||
Less: Goodwill | (647,757) | (647,757) | (647,757) | ||||
Less: Other intangibles | (42,625) | (45,132) | (51,827) | ||||
Total tangible common equity | $ 4,005,205 | $ 3,883,101 | $ 3,221,399 | ||||
Total assets | $ 36,744,162 | $ 35,749,333 | $ 36,942,714 | ||||
Less: Goodwill | (647,757) | (647,757) | (647,757) | ||||
Less: Other intangibles | (42,625) | (45,132) | (51,827) | ||||
Total tangible assets | $ 36,053,780 | $ 35,056,444 | $ 36,243,130 | ||||
Tangible common equity to tangible assets | 11.11 | % | 11.08 | % | 8.89 | % | |
Common shares outstanding at end of period | 103,455,535 | 103,397,699 | 103,228,615 | ||||
Tangible book value per common share | $ 38.71 | $ 37.56 | $ 31.21 | ||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | 31-Mar-13 | ||||
Common stockholders’ equity | $ 4,695,587 | $ 4,575,990 | $ 3,920,983 | ||||
Less: Unrealized losses (gains) on available-for-sale securities, net of tax[1] | 22,255 | 48,344 | (130,562) | ||||
Less: Disallowed deferred tax assets[2] | (624,364) | (626,570) | (433,543) | ||||
Less: Disallowed goodwill and other intangible assets | (639,158) | (643,185) | (658,383) | ||||
Less: Aggregate adjusted carrying value of all non-financial equity investments | (1,499) | (1,442) | (1,331) | ||||
Add: Pension liability adjustment, net of tax and accumulated net gains (losses) on cash flow hedges[3] | |||||||
103,524 | 104,302 | 222,016 | |||||
Total Tier 1 common equity | $ 3,556,345 | $ 3,457,439 | $ 2,919,180 | ||||
Tier 1 common equity to risk-weighted assets | 15.07 | % | 14.83 | % | 12.36 | % | |
[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 $154 million of the Corporation’s $774 million of net deferred tax assets classified as other assets at March 31, 2014 (December 31, 2013 - $167 million and $762 million, respectively; March 31, 2013 - $135 million and $608 million, respectively), were included without limitation in regulatory capital pursuant to the risk-based capital guidelines, while approximately $624 million of such assets at March 31, 2014 (December 31, 2013 - $627 million; March 31, 2013 - $434 million) exceeded the limitation imposed by these guidelines and, as “disallowed deferred tax assets”, were deducted in arriving at Tier 1 capital. The remaining $(4) million of the Corporation’s other net deferred tax components at March 31, 2014 (December 31, 2013 - $(32) million; March 31, 2013 - $39 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 First Quarter 2014 Earnings Release | ||||||
Table O - Financial Information - Westernbank Covered Loans | ||||||
(Unaudited) | ||||||
Revenues |
||||||
Quarters ended | ||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | Variance | |||
Interest income on covered loans | $ 81,098 | $ 86,794 | $ (5,696) | |||
FDIC loss share expense: | ||||||
Amortization of indemnification asset | (48,946) | (45,193) | (3,753) | |||
80% mirror accounting on credit impairment losses [1] | 15,090 | 7,125 | 7,965 | |||
80% mirror accounting on reimbursable expenses | 12,745 | 5,430 | 7,315 | |||
80% mirror accounting on recoveries on covered assets, including
rental |
||||||
(4,392) | (1,255) | (3,137) | ||||
Change in true-up payment obligation | 1,168 | (3,420) | 4,588 | |||
Other | 129 | 149 | (20) | |||
Total FDIC loss share expense | (24,206) | (37,164) | 12,958 | |||
Total revenues | 56,892 | 49,630 | 7,262 | |||
Provision for loan losses | 25,714 | 8,907 | 16,807 | |||
Total revenues less provision for loan losses | $ 31,178 | $ 40,723 | $ (9,545) | |||
[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. |
||||||
Non-personnel operating expenses |
||||||
Quarters ended | ||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | Variance | |||
Professional fees | $ 4,198 | $ 5,865 | $ (1,667) | |||
OREO expenses | 4,029 | 4,206 | (177) | |||
Other operating expenses | 4,796 | 2,679 | 2,117 | |||
Total operating expenses | $ 13,023 | $ 12,750 | $ 273 | |||
Expense reimbursements from the FDIC may be recorded with a time lag, since these are claimed upon the event of loss or charge-off of the loans which may occur in a subsequent period. | ||||||
Quarterly average assets |
||||||
Quarters ended | ||||||
(In millions) | 31-Mar-14 | 31-Dec-13 | Variance | |||
Covered loans | $ 2,934 | $ 3,017 | $ (83) | |||
FDIC loss share asset | 899 | 1,123 | (224) |
Activity in the carrying amount and accretable yield of covered loans accounted for under ASC 310-30 |
|||||||||
Quarters ended | |||||||||
31-Mar-14 | 31-Dec-13 | ||||||||
(In thousands) | Accretable yield |
Carrying amount |
Accretable yield |
Carrying amount |
|||||
Beginning balance | $ 1,309,205 | $ 2,827,947 | $ 1,309,618 | $ 2,891,049 | |||||
Accretion | (79,118) | 79,118 | (83,653) | 83,653 | |||||
Changes in expected cash flows | (11,875) | - | 83,240 | - | |||||
Collections / charge-offs | - | (173,943) | - | (146,755) | |||||
Ending balance | 1,218,212 | 2,733,122 | 1,309,205 | 2,827,947 | |||||
Allowance for loan losses - ASC 310-30 covered loans | - | (90,371) | - | (93,915) | |||||
Ending balance, net of allowance for loan losses | $ 1,218,212 | $ 2,642,751 | $ 1,309,205 | $ 2,734,032 | |||||
Activity in the carrying amount of the FDIC indemnity asset |
|||||||||
Quarters ended | |||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | |||||||
Balance at beginning of period | $ 948,608 | $ 1,324,711 | |||||||
Amortization | (48,946) | (45,193) | |||||||
Credit impairment losses to be covered under loss sharing agreements | 15,090 | 7,125 | |||||||
Reimbursable expenses to be covered under loss sharing agreements | 12,745 | 5,430 | |||||||
Net payments to (from) FDIC under loss sharing agreements | (93,776) | (343,465) | |||||||
Balance at end of period | $ 833,721 | $ 948,608 | |||||||
Activity in the remaining FDIC loss share asset amortization |
|||||||||
Quarters ended | |||||||||
(In thousands) | 31-Mar-14 | 31-Dec-13 | |||||||
Balance at beginning of period | $ 103,691 | $ 122,496 | |||||||
Amortization | (48,946) | (45,193) | |||||||
Impact of lower projected losses | 16,889 | 26,388 | |||||||
Balance at end of period | $ 71,634 | $ 103,691 | |||||||
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