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):
January
26, 2016
POPULAR,
INC.
(Exact
name of registrant as specified in its charter)
Puerto Rico |
001-34084 |
66-0667416 |
(State or other jurisdiction of
|
(Commission File Number)
|
(IRS Employer Identification Number) |
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 January 26, 2016 Popular, Inc. issued a news release announcing its unaudited financial results for the quarter ended December 31, 20145 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
Exhibit 99.1- Press release dated January 26, 2016
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: January 26, 2016 |
By: /s/ Jorge J. García |
|
Jorge J. García |
||
Senior Vice President and Corporate Comptroller |
Exhibit 99.1
Popular, Inc. Announces Fourth Quarter Financial Results
SAN JUAN, Puerto Rico--(BUSINESS WIRE)--January 26, 2016--Popular, Inc. (the “Corporation” or “Popular”) (NASDAQ:BPOP) reported net income of $137.4 million and adjusted net income of $98.3 million for the quarter ended December 31, 2015, compared to net income of $85.6 million and an adjusted net income of $93.4 million for the quarter ended September 30, 2015.
Mr. Richard L. Carrión, Chairman of the Board and Chief Executive Officer, said: “In 2015 we achieved several key milestones such as the Doral transactions and the completion of the restructuring of our U.S. operations. At the same time, we consistently delivered strong financial results despite the continued weakness of the Puerto Rico economy. The reinstatement of the quarterly dividend on our common stock demonstrates our confidence in our capital position and our revenue generation capacity going forward."
Earnings Highlights | ||||||||||||||||||||||
(Unaudited) | Quarters ended | Years ended | ||||||||||||||||||||
(Dollars in thousands, except per share information) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | 31-Dec-15 | 31-Dec-14 | |||||||||||||||||
Net interest income | $352,500 | $350,735 | $326,861 | $1,408,983 | $945,072 | |||||||||||||||||
Provision for loan losses | 57,711 | 69,568 | 51,637 | 217,458 | 223,999 | |||||||||||||||||
Provision (reversal) for loan losses - covered loans [1] |
820 | (2,890 | ) | (3,646 | ) | 24,020 | 46,135 | |||||||||||||||
Net interest income after provision for loan losses | 293,969 | 284,057 | 278,870 | 1,167,505 | 674,938 | |||||||||||||||||
FDIC loss-share income (expense) | (4,359 | ) | 1,207 | (18,693 | ) | 20,062 | (103,024 | ) | ||||||||||||||
Other non-interest income | 136,797 | 129,902 | 122,057 | 499,479 | 489,539 | |||||||||||||||||
Operating expenses | 305,808 | 306,897 | 330,006 | 1,288,221 | 1,193,684 | |||||||||||||||||
Income (loss) from continuing operations before income tax | 120,599 | 108,269 | 52,228 | 398,825 | (132,231 | ) | ||||||||||||||||
Income tax expense (benefit) | (16,827 | ) | 22,620 | 12,472 | (495,172 | ) | 58,279 | |||||||||||||||
Income (loss) from continuing operations | 137,426 | 85,649 | 39,756 | 893,997 | (190,510 | ) | ||||||||||||||||
(Loss) income from discontinued operations, net of tax | - | (9 | ) | 9,086 | 1,347 | (122,980 | ) | |||||||||||||||
Net income (loss) | $137,426 | $85,640 | $48,842 | $895,344 | $(313,490 | ) | ||||||||||||||||
Net income (loss) applicable to common stock | $136,495 | $84,709 | $47,911 | $891,621 | $(317,213 | ) | ||||||||||||||||
Net income (loss) per common share from continuing operations - Basic | $1.32 | $0.82 | $0.38 | $8.65 | $(1.88 | ) | ||||||||||||||||
Net income (loss) per common share from continuing operations - Diluted | $1.32 | $0.82 | $0.37 | $8.64 | $(1.88 | ) | ||||||||||||||||
Net income (loss) per common share from discontinued operations - Basic | $- | $- | $0.09 | $0.01 | $(1.20 | ) | ||||||||||||||||
Net income (loss) per common share from discontinued operations - Diluted | $- | $- | $0.09 | $0.01 | $(1.20 | ) | ||||||||||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under an FDIC loss-sharing agreement. | ||||||||||||||||||||||
Doral Bank Transaction
During the fourth quarter of 2015, retrospective adjustments were made to the estimated fair values of the assets acquired and liabilities assumed from the FDIC as receiver for Doral Bank, during the first quarter of 2015 (the “Doral Bank Transaction”), to reflect new information obtained during the measurement period that existed as of the acquisition date, as defined by U.S. GAAP. This process led to a lower fair value of the assets acquired and to a corresponding increase in goodwill.
Refer to the following table for details of the above mentioned retrospective adjustments.
February 27, 2015 | February 27, 2015 | ||||||||||||
As recasted[a] | As previously | ||||||||||||
(In thousands) | reported[b] | Change | |||||||||||
Assets: | |||||||||||||
Loans | $ | 1,518,574 | $ | 1,665,756 | $ | (147,182 | ) | ||||||
Goodwill | 163,097 | 41,633 | 121,464 | ||||||||||
Core deposit intangible | 12,810 | 23,572 | (10,762 | ) | |||||||||
Receivable from the FDIC | 480,137 [c] | 441,721 | 38,416 | ||||||||||
Other assets | 626,177 | 626,177 | - | ||||||||||
Total assets | $ | 2,800,795 | $ | 2,798,859 | $ | 1,936 | |||||||
Liabilities: | |||||||||||||
Deposits | $ | 2,203,391 | $ | 2,201,455 | $ | 1,936 | |||||||
Advances from the Federal Home Loan Bank | 547,187 | 547,187 | - | ||||||||||
Other liabilities | 50,217 | 50,217 | - | ||||||||||
Total liabilities |
$ | 2,800,795 | $ | 2,798,859 | $ | 1,936 | |||||||
[a] Amounts reported include retrospective adjustments during the measurement period, in accordance with U.S. GAAP, related to the Doral Bank Transaction. |
|||||||||||||
[b] Amounts are presented as previously reported in the Form 10-Q as of September 30, 2015. | |||||||||||||
[c] Balances recasted include a reclassification of approximately $38.4 million of loans that were subsequently determined to be excluded from the Doral Bank Transaction and repurchased by the FDIC, to the Receivable from the FDIC. | |||||||||||||
The decline in the fair value of the loans is mainly attributed to higher estimated credit losses on the portfolio of taxi medallion loans acquired by BPNA, which had an unpaid principal balance of $248.6 million and a revised fair value of $154.9 million. This remeasurement resulted in a negative adjustment of approximately $76.9 million to this portfolio. The main factors that influenced the revised estimated credit losses included borrower concentration in the portfolio, review of collateral values and borrowers’ payment capacity after a more thorough due diligence process.
Adjusted results – Non GAAP
The following tables reflect the results of operations for the fourth and third quarters of 2015, with adjustments to exclude the impact of certain events.
Quarter ended | |||||||||||||||||||||||||
(Unaudited) | 31-Dec-15 | ||||||||||||||||||||||||
(In thousands) |
Actual Results |
BPNA |
Doral Transaction |
Bulk Loan Sale |
Impairment of |
Reversal of DTA |
Adjusted |
||||||||||||||||||
Net interest income | $352,500 | $- | $1,952 | $- | $- | $- | $350,548 | ||||||||||||||||||
Provision for loan losses – non-covered loans | 57,711 | - | - | 5,852 | 5,064 | - | 46,795 | ||||||||||||||||||
Provision (reversal) for loan losses – covered loans [1] | 820 | - | - | - | - | - | 820 | ||||||||||||||||||
Net interest income after provision for loan losses | 293,969 | - | 1,952 | (5,852 | ) | (5,064 | ) | - | 302,933 | ||||||||||||||||
Mortgage banking activities | 23,430 | - | 833 | - | - | - | 22,597 | ||||||||||||||||||
FDIC loss-share (expense) income | (4,359 | ) | - | - | - | - | (4,359 | ) | |||||||||||||||||
Other non-interest income | 113,367 | - | - | - | - | - | 113,367 | ||||||||||||||||||
Total non-interest income | 132,438 | - | 833 | - | - | - | 131,605 | ||||||||||||||||||
Personnel costs | 119,221 | - | - | - | - | - | 119,221 | ||||||||||||||||||
Net occupancy expenses | 20,616 | - | - | - | - | - | 20,616 | ||||||||||||||||||
Equipment expenses | 16,035 | - | - | - | - | - | 16,035 | ||||||||||||||||||
Professional fees | 77,854 | - | - | - | - | - | 77,854 | ||||||||||||||||||
Communications | 6,759 | - | - | - | - | - | 6,759 | ||||||||||||||||||
Business promotion | 15,162 | - | - | - | - | - | 15,162 | ||||||||||||||||||
Other real estate owned (OREO) expenses | 9,997 | - | - | - | - |
- |
9,997 | ||||||||||||||||||
Amortization of intangibles | 2,522 | - | (628 | ) | - | - |
- |
3,150 | |||||||||||||||||
Restructuring costs | 1,004 | 1,004 | - | - | - | - | - | ||||||||||||||||||
Other operating expenses | 36,638 | - | - | - | - | - | 36,638 | ||||||||||||||||||
Total operating expenses | 305,808 | 1,004 | (628 | ) | - | - | - | 305,432 | |||||||||||||||||
Income before income tax | 120,599 | (1,004 | ) | 3,413 | (5,852 | ) | (5,064 | ) | - | 129,106 | |||||||||||||||
Income tax (benefit) expense | (16,827 | ) | - | 731 | (2,282 | ) | (1,975 | ) | (44,103 | ) | 30,802 | ||||||||||||||
Net income | $137,426 | $(1,004 | ) | $2,682 | $(3,570 | ) | $(3,089 | ) | $44,103 | $98,304 | |||||||||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under an FDIC loss-sharing agreement. | |||||||||||||||||||||||||
[2] Represents restructuring charges associated with the reorganization of BPNA. | |||||||||||||||||||||||||
[3] Represents the impact of the fair value adjustments, identified during the remeasurement period as defined by U.S. GAAP, related to the Doral Bank Transaction. The remeasurement adjustments impacted the fair value of the loan portfolio, deposit premium and the core deposit intangible, all of which were recorded against goodwill. During the fourth quarter of 2015, the related amortization of the loan discounts, deposit premium and the core deposit intangible were adjusted to reflect the balance as if the revised estimates of fair value were applied as of the Doral Bank Transaction date. |
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[4] Represents the impact of a bulk sale of loans at the BPPR segment, which had a book value of approximately $34.4 million. | |||||||||||||||||||||||||
[5] Represents additional impairment based on the estimated fair value of loans in the Westernbank transaction, that the Corporation has the intent to sell and are subject to the ongoing arbitration with the FDIC. |
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[6] Represents the partial reversal of the valuation allowance of a portion of the deferred tax asset at the U.S. operations. Refer to additional details on the Income Taxes section of this earnings release. |
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Quarter ended | ||||||||||||||||||
(Unaudited) | 30-Sep-15 | |||||||||||||||||
(In thousands) |
Actual Results |
BPNA |
Doral |
MSRs |
Impairment of |
Adjusted |
||||||||||||
Net interest income | $350,735 | $- | $- | $- | $- | $350,735 | ||||||||||||
Provision for loan losses |
69,568 |
- | - | - | 10,126 | 59,442 | ||||||||||||
Provision (reversal) for loan losses – covered loans [1] |
(2,890 | ) | - | - | - | - | (2,890 | ) | ||||||||||
Net interest income after provision for loan losses | 284,057 | - | - | - | (10,126 | ) | 294,183 | |||||||||||
Mortgage banking activities | 24,195 | - | 844 | 4,378 | - | 18,973 | ||||||||||||
FDIC loss-share income | 1,207 | - | - | - | - | 1,207 | ||||||||||||
Other non-interest income | 105,707 | - | (10 | ) | - | - | 105,717 | |||||||||||
Total non-interest income | 131,109 | - | 834 | 4,378 | - | 125,897 | ||||||||||||
Personnel costs | 120,863 | - | 806 | - | - | 120,057 | ||||||||||||
Net occupancy expenses | 21,277 | - | 1,151 | - | - | 20,126 | ||||||||||||
Equipment expenses | 14,739 | - | - | - | - | 14,739 | ||||||||||||
Professional fees | 77,154 | - | 3,599 | - | - | 73,555 | ||||||||||||
Communications | 6,058 | - | - | - | - | 6,058 | ||||||||||||
Business promotion | 12,325 | - | 100 | - | - | 12,225 | ||||||||||||
Other real estate owned (OREO) expenses | 7,686 | - | - | - | - | 7,686 | ||||||||||||
Amortization of intangibles | 3,512 | - | - | - | - | 3,512 | ||||||||||||
Restructuring costs | 481 | 481 | - | - | - | - | ||||||||||||
Other operating expenses | 42,802 | - | - | - | - | 42,802 | ||||||||||||
Total operating expenses | 306,897 | 481 | 5,656 | - | - | 300,760 | ||||||||||||
Income from continuing operations before income tax | 108,269 | (481 | ) | (4,822 | ) | 4,378 | (10,126 | ) | 119,320 | |||||||||
Income tax expense | 22,620 | - | (1,050 | ) | 1,707 | (3,949 | ) | 25,912 | ||||||||||
Income from continuing operations | $85,649 | $(481 | ) | $(3,772 | ) | $2,671 | $(6,177 | ) | $93,408 | |||||||||
Income from discontinued operations, net of tax | $(9 | ) | $(9 | ) | $- | $- | $- | $- | ||||||||||
Net income | $85,640 | $(490 | ) | $(3,772 | ) | $2,671 | $(6,177 | ) | $93,408 | |||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under an FDIC loss-sharing agreement. | ||||||||||||||||||
[2] Represents restructuring charges associated with the reorganization of BPNA. | ||||||||||||||||||
[3] Includes approximately $0.8 million of fees charged for loan servicing cost to the FDIC, personnel costs related to former Doral Bank employees retained on a temporary basis and incentive compensation for an aggregate of $0.8 million, building rent expense of Doral Bank’s administrative offices for $1.2 million and professional fees and business promotion expenses directly associated with the Doral Bank Transaction and systems conversion for $3.7 million. |
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[4] Represents the fair value of mortgage servicing rights acquired for a portfolio previously serviced by Doral Bank, for which the Corporation acted as a backup servicer, under a pre-existing contract. | ||||||||||||||||||
[5] Represents impairment based on the estimated fair value of loans acquired in the Westernbank transaction, that the Corporation has the intent to sell and are subject to the ongoing arbitration with the FDIC. |
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Quarters ended | ||||||||||||
(Unaudited) | Adjusted Results Non-GAAP | |||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | Variance | |||||||||
Net interest income | $350,548 | $350,735 | $(187 | ) | ||||||||
Provision for loan losses – non-covered loans | 46,795 | 59,442 | (12,647 | ) | ||||||||
Provision (reversal) for loan losses – covered loans [1] | 820 | (2,890 | ) | 3,710 | ||||||||
Net interest income after provision for loan losses | 302,933 | 294,183 | 8,750 | |||||||||
Mortgage banking activities | 22,597 | 18,973 | 3,624 | |||||||||
FDIC loss-share income (expense) | (4,359 | ) | 1,207 | (5,566 | ) | |||||||
Other non-interest income | 113,367 | 105,717 | 7,650 | |||||||||
Total non-interest income | 131,605 | 125,897 | 5,708 | |||||||||
Personnel costs | 119,221 | 120,057 | (836 | ) | ||||||||
Net occupancy expenses | 20,616 | 20,126 | 490 | |||||||||
Equipment expenses | 16,035 | 14,739 | 1,296 | |||||||||
Professional fees | 77,854 | 73,555 | 4,299 | |||||||||
Communications | 6,759 | 6,058 | 701 | |||||||||
Business promotion | 15,162 | 12,225 | 2,937 | |||||||||
Other real estate owned (OREO) expenses | 9,997 | 7,686 | 2,311 | |||||||||
Amortization of intangibles | 3,150 | 3,512 | (362 | ) | ||||||||
Other operating expenses | 36,638 | 42,802 | (6,164 | ) | ||||||||
Total operating expenses | 305,432 | 300,760 | 4,672 | |||||||||
Income from continuing operations before income tax | 129,106 | 119,320 | 9,786 | |||||||||
Income tax expense | 30,802 | 25,912 | 4,890 | |||||||||
Income from continuing operations | $98,304 | $93,408 | $4,896 | |||||||||
Net income | $98,304 | $93,408 | $4,896 | |||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss-sharing agreements. | ||||||||||||
Net interest income
For the quarter ended December 31 2015, the Corporation had net interest income of $352.5 million, compared to net interest income of $350.7 million for the previous quarter. The adjusted net interest income was $350.6 million, flat compared to the previous quarter. The net interest margin was 4.42% for the quarter. The adjusted net interest margin was 4.39%, also flat when compared to the previous quarter. Refer to the Adjusted Results – Non GAAP section for additional information on the adjusted net interest income.
The decrease of $0.1 million in the adjusted net interest income is mainly related to:
These negative variances in net interest income were offset in part by:
BPPR’s net interest income amounted to $305.1 million for the quarter ended December 31, 2015. The adjusted net interest income was $304.3 million, a decrease of $0.5 million when compared to the previous quarter. The impact of lower income from commercial and construction loans was offset by higher income from mortgage loans and lower borrowing costs, as discussed above, and lower expense on equity indexed IRA accounts. Net interest margin was 4.82%. The adjusted net interest margin was 4.80%, an increase of 5 basis points compared to 4.75% for the previous quarter, mainly due to lower borrowing costs.
BPNA’s net interest income was $62.9 million. The adjusted net interest income was of $61.7 million, compared with $62.4 million for the previous quarter. The decrease of $0.7 million in the net interest income is mainly driven by lower yields in the commercial portfolio and lower volumes of mortgage loans, as discussed above, which was partially offset by higher income from consumer loans by $1.4 million. Also, higher interest expense on deposits by $1.3 million, mainly for higher volume of non-brokered client related time deposits, contributed to the decrease in net interest income. Net interest margin was 3.86%. The adjusted net interest margin was of 3.79% compared to 3.91% for the previous quarter, a decrease of 12 basis points, mainly due to lower yields from commercial loans and higher cost of interest bearing deposits.
Non-interest income
Non-interest income was $132.4 million for the fourth quarter of 2015, an increase of $1.3 million when compared with the third quarter of 2015. Excluding the impact of the transactions detailed in the Adjusted Results Non-GAAP tables above, non-interest income increased by $5.7 million when compared to the third quarter of 2015, driven primarily by the following:
These increases were partially offset by:
Refer to Table B for further details.
Financial Impact of the 2010 FDIC-Assisted Transaction | |||||||||||||||||||
(Unaudited) | Quarters ended | Years ended | |||||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | 31-Dec-15 | 31-Dec-14 | ||||||||||||||
Income Statement |
|||||||||||||||||||
Interest income on WB loans | $47,870 | $47,982 | $61,285 | $208,779 | $293,610 | ||||||||||||||
Total FDIC loss-share (expense) income | (4,359 | ) | 1,207 | (18,693 | ) | 20,062 | (103,024 | ) | |||||||||||
Provision for loan losses | 7,817 | 20,206 | (3,646 | ) | 54,113 | 46,135 | |||||||||||||
Total revenues less provision for loan losses | $35,694 | $28,983 | $46,238 | $174,728 | $144,451 | ||||||||||||||
Balance Sheet |
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Loans covered under loss-sharing agreements with FDIC | $646,115 | $665,428 | $2,542,662 | ||||||||||||||||
FDIC loss-share asset | 310,221 | 311,946 | 542,454 | ||||||||||||||||
FDIC true-up payment obligation | 119,745 | 122,527 | 129,304 | ||||||||||||||||
See additional details on accounting for the 2010 FDIC-Assisted transaction in Table O. |
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Operating expenses
Operating expenses of $305.8 million for the quarter decreased by $1.1 million when compared with the third quarter of 2015. Excluding the impact of the transactions detailed in the Adjusted Results Non-GAAP tables above, operating expenses increased by $4.7 million compared to the third quarter of 2015, 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 $14.4 million for the fourth quarter of 2015, compared with $12.7 million for the third quarter of 2015. The increase was principally due to higher OREO write-downs, as mentioned above.
Full-time equivalent employees were 7,810 as of December 31, 2015, compared with 7,840 as of September 30, 2015, and 7,752 as of December 31, 2014.
For a breakdown of operating expenses by category refer to table B.
Income taxes
For the quarter ended December 31, 2015, the Corporation recorded an income tax benefit of $16.8 million, compared to an income tax expense of $22.6 million for the previous quarter. During the fourth quarter of 2015, the Corporation recorded a partial reversal of the valuation allowance on its deferred tax assets from the U.S. operations for approximately $44.1 million. This adjustment was incremental to the partial reversal of $544.9 million recorded during the second quarter of 2015 and was mainly related to a change in the estimate of the realizability of state and city deferred tax assets, as new information was considered after having completed the U.S. reorganization and the sources of income of the business acquired in connection with the Doral Bank Transaction. On an adjusted basis, the income tax expense for the fourth quarter of 2015 was $30.8 million, compared to $25.9 million for the previous quarter.
The effective income tax rate for the fourth quarter of 2015, on an adjusted basis, was 24%, compared to 22% for the previous quarter. The effective tax rate is impacted by the composition and source of the taxable income. In 2016, after taking effect for the partial deferred tax asset valuation reversal, the Corporation expects that the effective tax rate for the U.S. operations will be approximately 44%. Adjusting to an effective tax rate of 44% for the U.S. operations, and assuming the same earnings composition of this quarter, the adjusted effective income tax rate for the Corporation’s consolidated results for the fourth quarter of 2015 would have been 30%.
Credit Quality
Overall, the Corporation continued to exhibit a stable credit performance in a challenging operating environment given the continuing weakness in the Puerto Rico economy. During the fourth quarter of 2015, credit metrics were impacted by a few specific large borrowers and the bulk sale of commercial loans amounting to $34.4 million. The Corporation continues to closely monitor the performance of its portfolios and is focused in taking measures to minimize risks.
Non-Performing Assets | ||||||||||||
(Unaudited) | ||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | |||||||||
Total non-performing loans held-in-portfolio, excluding covered loans | $601,799 | $634,902 | $630,483 | |||||||||
Non-performing loans held-for-sale | 45,169 | 47,681 | 18,899 | |||||||||
Other real estate owned (“OREO”), excluding covered OREO | 155,231 | 155,826 | 135,500 | |||||||||
Total non-performing assets, excluding covered assets | 802,199 | 838,409 | 784,882 | |||||||||
Covered loans and OREO | 40,571 | 39,888 | 148,099 | |||||||||
Total non-performing assets | $842,770 | $878,297 | $932,981 | |||||||||
Net charge-offs for the quarter (excluding covered loans) | $82,870 | $46,302 | $50,187 | |||||||||
Ratios (excluding covered loans): | ||||||||||||
Non-covered loans held-in-portfolio | $22,346,115 | $22,498,066 | $19,404,451 | |||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio | 2.69 | % | 2.82 | % | 3.25 | % | ||||||
Allowance for loan losses to loans held-in-portfolio | 2.25 | 2.38 | 2.68 | |||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale | 83.57 | 84.42 | 82.43 | |||||||||
Refer to Table H for additional information. | ||||||||||||
Provision for Loan Losses | ||||||||||||||||||
(Unaudited) | Quarters ended | Years ended | ||||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | 31-Dec-15 | 31-Dec-14 | |||||||||||||
Provision (reversal) for loan losses: | ||||||||||||||||||
BPPR | $55,635 | $68,755 | $52,206 | $216,832 | $242,849 | |||||||||||||
BPNA | 2,076 | 813 | (569 | ) | 626 | (18,850 | ) | |||||||||||
Total provision for loan losses | $57,711 | $69,568 | $51,637 | $217,458 | $223,999 | |||||||||||||
Provision (reversal) for loan losses - covered loans | 820 | (2,890 | ) | (3,646 | ) | 24,020 | 46,135 | |||||||||||
Total provision for loan losses | $58,531 | $66,678 | $47,991 | $241,478 | $270,134 | |||||||||||||
Credit Quality by Segment | ||||||||||||
(Unaudited) | ||||||||||||
(In thousands) |
|
Quarters ended |
||||||||||
BPPR | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | |||||||||
Provision for loan losses | $55,635 | $68,755 | $52,206 | |||||||||
Net charge-offs | 82,011 | 47,245 | 52,523 | |||||||||
Total non-performing loans held-in-portfolio, excluding covered loans | 574,834 | 609,469 | 611,383 | |||||||||
Allowance / non-covered loans held-in-portfolio | 2.67 | % | 2.83 | % | 3.07 | % | ||||||
|
Quarters ended |
|||||||||||
BPNA | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | |||||||||
Provision (reversal) for loan losses | $2,076 | $813 | $(569 | ) | ||||||||
Net charge-offs (recoveries) | 859 | (943 | ) | (2,336 | ) | |||||||
Total non-performing loans held-in-portfolio | 26,965 | 25,433 | 19,100 | |||||||||
Allowance / non-covered loans held-in-portfolio | 0.69 | % | 0.68 | % | 0.88 | % | ||||||
Financial Condition Highlights | |||||||||||
(Unaudited) | |||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | ||||||||
Money market, trading and investment securities | $8,587,894 | $8,321,397 | $7,541,148 | ||||||||
Loans not covered under loss-sharing agreements with the FDIC | 22,346,115 | 22,498,066 | 19,404,451 | ||||||||
Loans covered under loss-sharing agreements with the FDIC | 646,115 | 665,428 | 2,542,662 | ||||||||
Total assets | 35,769,534 | 35,530,794 | 33,096,695 | ||||||||
Deposits | 27,209,723 | 26,713,206 | 24,807,535 | ||||||||
Borrowings | 2,433,654 | 2,761,476 | 3,004,685 | ||||||||
Liabilities from discontinued operations | 1,815 | 1,800 | 5,064 | ||||||||
Total liabilities | 30,664,210 | 30,481,158 | 28,829,313 | ||||||||
Stockholders’ equity | 5,105,324 | 5,049,636 | 4,267,382 | ||||||||
Total assets increased by $238.7 million from the third quarter of 2015 driven by:
This increase was partially offset by:
Total liabilities increased by $183.0 million from the third quarter of 2015, driven by:
This increase was partially offset by:
Stockholders’ equity increased by approximately $55.7 million from the third quarter of 2015, mainly as a result of net income for the quarter of $137.4 million, net of a reduction of $15.5 million related to the quarterly cash dividend of $0.15 per share declared on the outstanding common stock and preferred dividends of $0.9 million, and an increase in accumulated other comprehensive loss of $67.1 million, principally due to higher unrealized losses on securities available-for-sale by $52.4 million and $16.0 million related to the adjustment of pension and postretirement benefit plans, net of tax.
Common equity tier-1 ratio and tangible book value per share were 16.21% and $42.18, respectively, at December 31, 2015 compared to 16.21% and $42.71 at September 30, 2015. The re-measurement of goodwill on the Doral Bank Transaction reduced tangible book value per share by $1.06. Refer to Table A for capital ratios.
Refer to Table C for the Statements of Financial Condition.
Forward-Looking Statements
The information contained in this presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and are subject to risks and uncertainties that may cause the Corporation's actual results to differ materially from any future results expressed or implied by such forward-looking statements. Please refer to our Annual Report on Form 10-K for the year ended December 31, 2014, the Quarterly Reports on Form 10-Q for the quarters ended March 31, 2015, June 30, 2015 and September 30, 2015 and our other filings with the SEC for a discussion of those factors that could impact our future results. Other than to the extent required by applicable law, the Corporation undertakes no obligation to publicly update or revise any forward-looking statement to reflect 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 and Florida.
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 Tuesday, January 26, 2016 at 10:00 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 1-866-235-1201 or 1-412-902-4127.
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 Friday, February 26, 2016. The replay dial in is 1-877-344-7529 or 1-412-317-0088. The replay passcode is 10077993.
Popular, Inc. |
Financial Supplement to Fourth Quarter 2015 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 Loans |
Table P - Restructuring Charges |
Table Q - Adjusted Consolidated Statement of Operations for the Years Ended December 31, 2015 and 2014 (Non-GAAP) |
POPULAR, INC. | ||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||||||
Table A - Selected Ratios and Other Information | ||||||||||||||||
(Unaudited) | ||||||||||||||||
Quarters ended | Years ended | |||||||||||||||
31-Dec-15 | 30-Sep-15 | 31-Dec-14 | 31-Dec-15 | 31-Dec-14 | ||||||||||||
Basic EPS from continuing operations | $1.32 | $0.82 | $0.38 | $8.65 | $(1.88 | ) | ||||||||||
Basic EPS from discontinued operations | $- | $- | $0.09 | $0.01 | $(1.20 | ) | ||||||||||
Total Basic EPS | $1.32 | $0.82 | $0.47 | $8.66 | $(3.08 | ) | ||||||||||
Diluted EPS from continuing operations | $1.32 | $0.82 | $0.37 | $8.64 | $(1.88 | ) | ||||||||||
Diluted EPS from discontinued operations | $- | $- | $0.09 | $0.01 | $(1.20 | ) | ||||||||||
Total Diluted EPS | $1.32 | $0.82 | $0.46 | $8.65 | $(3.08 | ) | ||||||||||
Average common shares outstanding | 103,098,249 | 102,969,214 | 102,859,416 | 102,967,186 | 102,848,792 | |||||||||||
Average common shares outstanding - assuming dilution | 103,259,503 | 103,150,482 | 103,166,349 | 103,124,309 | 102,848,792 | |||||||||||
Common shares outstanding at end of period | 103,618,976 | 103,556,285 | 103,476,847 | 103,618,976 | 103,476,847 | |||||||||||
Market value per common share | $28.34 | $30.23 | $34.05 | $28.34 | $34.05 | |||||||||||
Market capitalization - (In millions) | $2,937 | $3,131 | $3,523 | $2,937 | $3,523 | |||||||||||
Return on average assets | 1.53 | % | 0.95 | % | 0.58 | % | 2.54 | % | (0.89 | )% | ||||||
. | ||||||||||||||||
Return on average common equity | 10.77 | % | 6.79 | % | 4.41 | % | 19.16 | % | (7.04 | )% | ||||||
Net interest margin [1] | 4.39 | % | 4.39 | % | 4.70 | % | 4.48 | % | 4.67 | % | ||||||
Common equity per share | $48.79 | $48.28 | $40.76 | $48.79 | $40.76 | |||||||||||
Tangible common book value per common share (non-GAAP) | $42.18 | $42.71 | $35.89 | $42.18 | $35.89 | |||||||||||
Tangible common equity to tangible assets (non-GAAP) | 12.46 | % | 12.65 | % | 11.39 | % | 12.46 | % | 11.39 | % | ||||||
Tier 1 capital [2] |
16.21 |
% | 16.21 | % | 18.13 | % |
16.21 |
% | 18.13 | % | ||||||
Total capital [2] |
18.78 |
% | 18.78 | % | 19.41 | % |
18.78 |
% | 19.41 | % | ||||||
Tier 1 leverage [2] | 11.82 | % | 11.75 | % | 11.94 | % | 11.82 | % | 11.94 | % | ||||||
Common equity to Tier 1 capital [2] |
16.21 |
% | 16.21 | % | 15.89 | % |
16.21 |
% | 15.89 | % | ||||||
[1] Not on a taxable equivalent basis. For the quarter ended December 31, 2015 excludes the impact of $1.9 million of Doral fair value remeasurement adjustment. U.S. GAAP net interest margin was 4.42% for the fourth quarter, compared with 4.39% for the previous quarter. For the quarter ended December 31, 2014 excludes the impact of $18.6 million fees related to repos refinancing at BPNA. U.S. GAAP net interest margin was 4.45% for the fourth quarter of 2014. For the year ended December 31, 2014, excludes the impact of $39.2 million and $414.1 million, respectively, related to repos refinancing at BPNA and the accelerated amortization of the TARP discount. The U.S. GAAP net interest margin was 3.16% for the year ended December 31, 2014. Refer to Tables D & E for reconciliation. |
||||||||||||||||
[2] Ratios for the quarters ending December 31, 2015 and September 30, 2015 were calculated based on Basel III Rules, while ratios for the previous periods were calculated based on the then applicable Basel I rules. Capital ratios for the current quarter are preliminary. | ||||||||||||||||
POPULAR, INC. | |||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||||||||
Table B - Consolidated Statement of Operations | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||
Quarters ended | Variance | Quarter ended | Variance | Years ended | |||||||||||||||||||
(In thousands, except per share information) | 31-Dec-15 | 30-Sep-15 |
Q4 2015 |
31-Dec-14 |
Q4 2015 |
31-Dec-15 | 31-Dec-14 | ||||||||||||||||
Interest income: | |||||||||||||||||||||||
Loans | $364,484 | $364,458 | $26 | $357,570 | $6,914 | $1,458,706 | $1,478,750 | ||||||||||||||||
Money market investments | 1,949 | 2,003 | (54 | ) | 1,113 | 836 | 7,243 | 4,224 | |||||||||||||||
Investment securities | 32,795 | 31,671 | 1,124 | 30,361 | 2,434 | 126,064 | 132,631 | ||||||||||||||||
Trading account securities | 2,129 | 3,150 | (1,021 | ) | 2,891 | (762 | ) | 11,001 | 17,938 | ||||||||||||||
Total interest income | 401,357 | 401,282 | 75 | 391,935 | 9,422 | 1,603,014 | 1,633,543 | ||||||||||||||||
Interest expense: | |||||||||||||||||||||||
Deposits | 27,054 | 28,357 | (1,303 | ) | 25,473 | 1,581 | 107,533 | 105,087 | |||||||||||||||
Short-term borrowings | 1,693 | 2,222 | (529 | ) | 20,489 | (18,796 | ) | 7,512 | 67,376 | ||||||||||||||
Long-term debt | 20,110 | 19,968 | 142 | 19,112 | 998 | 78,986 | 516,008 | ||||||||||||||||
Total interest expense | 48,857 | 50,547 | (1,690 | ) | 65,074 | (16,217 | ) | 194,031 | 688,471 | ||||||||||||||
Net interest income | 352,500 | 350,735 | 1,765 | 326,861 | 25,639 | 1,408,983 | 945,072 | ||||||||||||||||
Provision for loan losses - non-covered loans | 57,711 | 69,568 | (11,857 | ) | 51,637 | 6,074 | 217,458 | 223,999 | |||||||||||||||
Provision (reversal) for loan losses - covered loans | 820 | (2,890 | ) | 3,710 | (3,646 | ) | 4,466 | 24,020 | 46,135 | ||||||||||||||
Net interest income after provision for loan losses | 293,969 | 284,057 | 9,912 | 278,870 | 15,099 | 1,167,505 | 674,938 | ||||||||||||||||
Service charges on deposit accounts | 39,993 | 40,960 | (967 | ) | 39,456 | 537 | 160,108 | 158,637 | |||||||||||||||
Other service fees | 66,928 | 56,115 | 10,813 | 61,140 | 5,788 | 236,090 | 225,265 | ||||||||||||||||
Mortgage banking activities | 23,430 | 24,195 | (765 | ) | 8,747 | 14,683 | 81,802 | 30,615 | |||||||||||||||
Net gain (loss) and valuation adjustments on investment securities | - | 136 | (136 | ) | 893 | (893 | ) | 141 | (870 | ) | |||||||||||||
Other-than-temporary impairment losses on investment securities | - | - | - | - | - | (14,445 | ) | - | |||||||||||||||
Trading account (loss) profit | (1,631 | ) | (398 | ) | (1,233 | ) | 586 | (2,217 | ) | (4,723 | ) | 4,358 | |||||||||||
Net (loss) gain on sale of loans, including valuation adjustments on loans held-for-sale | (60 | ) | - | (60 | ) | 10,946 | (11,006 | ) | 542 | 40,591 | |||||||||||||
Adjustments (expense) to indemnity reserves on loans sold | (8,647 | ) | (5,874 | ) | (2,773 | ) | (13,348 | ) | 4,701 | (18,628 | ) | (40,629 | ) | ||||||||||
FDIC loss-share (expense) income | (4,359 | ) | 1,207 | (5,566 | ) | (18,693 | ) | 14,334 | 20,062 | (103,024 | ) | ||||||||||||
Other operating income | 16,784 | 14,768 | 2,016 | 13,637 | 3,147 | 58,592 | 71,572 | ||||||||||||||||
Total non-interest income | 132,438 | 131,109 | 1,329 | 103,364 | 29,074 | 519,541 | 386,515 | ||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Personnel costs | |||||||||||||||||||||||
Salaries | 77,578 | 78,193 | (615 | ) | 71,899 | 5,679 | 304,618 | 281,252 | |||||||||||||||
Commissions, incentives and other bonuses | 18,015 | 18,618 | (603 | ) | 18,439 | (424 | ) | 79,305 | 59,138 | ||||||||||||||
Pension, postretirement and medical insurance | 10,393 | 12,578 | (2,185 | ) | 6,901 | 3,492 | 44,059 | 32,416 | |||||||||||||||
Other personnel costs, including payroll taxes | 13,235 | 11,474 | 1,761 | 13,497 | (262 | ) | 49,537 | 45,873 | |||||||||||||||
Total personnel costs | 119,221 | 120,863 | (1,642 | ) | 110,736 | 8,485 | 477,519 | 418,679 | |||||||||||||||
Net occupancy expenses | 20,616 | 21,277 | (661 | ) | 23,877 | (3,261 | ) | 86,888 | 86,707 | ||||||||||||||
Equipment expenses | 16,035 | 14,739 | 1,296 | 13,091 | 2,944 | 60,110 | 48,917 | ||||||||||||||||
Other taxes | 10,159 | 9,951 | 208 | 14,343 | (4,184 | ) | 39,797 | 56,918 | |||||||||||||||
Professional fees | 77,854 | 77,154 | 700 | 80,383 | (2,529 | ) | 308,985 | 282,055 | |||||||||||||||
Communications | 6,759 | 6,058 | 701 | 6,119 | 640 | 25,146 | 25,684 | ||||||||||||||||
Business promotion | 15,162 | 12,325 | 2,837 | 13,530 | 1,632 | 52,076 | 54,016 | ||||||||||||||||
FDIC deposit insurance | 5,386 | 7,300 | (1,914 | ) | 9,338 | (3,952 | ) | 27,626 | 40,307 | ||||||||||||||
Loss on early extinguishment of debt | - | - | - | 532 | (532 | ) | - | 532 | |||||||||||||||
Other real estate owned (OREO) expenses | 9,997 | 7,686 | 2,311 | 20,016 | (10,019 | ) | 85,568 | 49,611 | |||||||||||||||
Credit and debit card processing, volume, interchange and other expenses | 5,822 | 6,449 | (627 | ) | 5,093 | 729 | 22,854 | 21,588 | |||||||||||||||
Other operating expenses | 15,271 | 19,102 | (3,831 | ) | 17,004 | (1,733 | ) | 72,221 | 73,785 | ||||||||||||||
Amortization of intangibles | 2,522 | 3,512 | (990 | ) | 2,083 | 439 | 11,019 | 8,160 | |||||||||||||||
Restructuring costs | 1,004 | 481 | 523 | 13,861 | (12,857 | ) | 18,412 | 26,725 | |||||||||||||||
Total operating expenses | 305,808 | 306,897 | (1,089 | ) | 330,006 | (24,198 | ) | 1,288,221 | 1,193,684 | ||||||||||||||
Income (loss) from continuing operations before income tax | 120,599 | 108,269 | 12,330 | 52,228 | 68,371 | 398,825 | (132,231 | ) | |||||||||||||||
Income tax (benefit) expense | (16,827 | ) | 22,620 | (39,447 | ) | 12,472 | (29,299 | ) | (495,172 | ) | 58,279 | ||||||||||||
Income (loss) from continuing operations | 137,426 | 85,649 | 51,777 | 39,756 | 97,670 | 893,997 | (190,510 | ) | |||||||||||||||
(Loss) income from discontinued operations, net of tax | - | (9 | ) | 9 | 9,086 | (9,086 | ) | 1,347 | (122,980 | ) | |||||||||||||
Net income (loss) | $137,426 | $85,640 | $51,786 | $48,842 | $88,584 | $895,344 | $(313,490 | ) | |||||||||||||||
Net income (loss) applicable to common stock | $136,495 | $84,709 | $51,786 | $47,911 | $88,584 | $891,621 | $(317,213 | ) | |||||||||||||||
Net income (loss) per common share - basic: | |||||||||||||||||||||||
Net income (loss) from continuing operations | $1.32 | $0.82 | $0.50 | $0.38 | $0.94 | $8.65 | $(1.88 | ) | |||||||||||||||
Net income (loss) from discontinued operations | - | - | - | 0.09 | (0.09 | ) | 0.01 | (1.20 | ) | ||||||||||||||
Net income (loss) per common share - basic | $1.32 | $0.82 | $0.50 | $0.47 | $0.85 | $8.66 | $(3.08 | ) | |||||||||||||||
Net income (loss) per common share - diluted: | |||||||||||||||||||||||
Net income (loss) from continuing operations | $1.32 | $0.82 | $0.50 | $0.37 | $0.95 | $8.64 | $(1.88 | ) | |||||||||||||||
Net income (loss) from discontinued operations | - | - | - | 0.09 | (0.09 | ) | 0.01 | (1.20 | ) | ||||||||||||||
Net income (loss) per common share - diluted | $1.32 | $0.82 | $0.50 | $0.46 | $0.86 | $8.65 | $(3.08 | ) | |||||||||||||||
Dividends Declared per Common Share | $0.15 | $0.15 | $- | $- | $0.15 |
$0.30 |
$- | ||||||||||||||||
Popular, Inc. | |||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||
Table C - Consolidated Statement of Financial Condition | |||||||||||||||
(Unaudited) | |||||||||||||||
Variance | |||||||||||||||
Q4 2015 vs. | |||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | Q3 2015 | |||||||||||
Assets: | |||||||||||||||
Cash and due from banks | $363,674 | $320,555 | $381,095 | $43,119 | |||||||||||
Money market investments | 2,180,092 | 2,408,571 | 1,822,386 | (228,479 | ) | ||||||||||
Trading account securities, at fair value | 71,659 | 137,943 | 138,527 | (66,284 | ) | ||||||||||
Investment securities available-for-sale, at fair value | 6,062,992 | 5,500,931 | 5,315,159 | 562,061 | |||||||||||
Investment securities held-to-maturity, at amortized cost | 100,903 | 100,295 | 103,170 | 608 | |||||||||||
Other investment securities, at lower of cost or realizable value | 172,248 | 173,657 | 161,906 | (1,409 | ) | ||||||||||
Loans held-for-sale, at lower of cost or fair value | 137,000 | 171,019 | 106,104 | (34,019 | ) | ||||||||||
Loans held-in-portfolio: | |||||||||||||||
Loans not covered under loss-sharing agreements with the FDIC | 22,453,813 | 22,601,271 | 19,498,286 | (147,458 | ) | ||||||||||
Loans covered under loss-sharing agreements with the FDIC | 646,115 | 665,428 | 2,542,662 | (19,313 | ) | ||||||||||
Less: Unearned income | 107,698 | 103,205 | 93,835 | 4,493 | |||||||||||
Allowance for loan losses |
537,111 | 570,514 | 601,792 | (33,403 | ) | ||||||||||
Total loans held-in-portfolio, net | 22,455,119 | 22,592,980 | 21,345,321 | (137,861 | ) | ||||||||||
FDIC loss-share asset | 310,221 | 311,946 | 542,454 | (1,725 | ) | ||||||||||
Premises and equipment, net | 502,611 | 495,103 | 494,581 | 7,508 | |||||||||||
Other real estate not covered under loss-sharing agreements with the FDIC | 155,231 | 155,826 | 135,500 | (595 | ) | ||||||||||
Other real estate covered under loss-sharing agreements with the FDIC | 36,685 | 35,701 | 130,266 | 984 | |||||||||||
Accrued income receivable | 124,234 | 118,044 | 121,818 | 6,190 | |||||||||||
Mortgage servicing assets, at fair value | 211,405 | 210,851 | 148,694 | 554 | |||||||||||
Other assets | 2,200,963 | 2,221,054 | 1,646,443 | (20,091 | ) | ||||||||||
Goodwill | 626,388 | 504,925 | 465,676 | 121,463 | |||||||||||
Other intangible assets | 58,109 | 71,393 | 37,595 | (13,284 | ) | ||||||||||
Total assets | $35,769,534 | $35,530,794 | $33,096,695 | $238,740 | |||||||||||
Liabilities and Stockholders’ Equity: | |||||||||||||||
Liabilities: | |||||||||||||||
Deposits: | |||||||||||||||
Non-interest bearing | $6,401,515 | $6,070,719 | $5,783,748 | $330,796 | |||||||||||
Interest bearing | 20,808,208 | 20,642,487 | 19,023,787 | 165,721 | |||||||||||
Total deposits | 27,209,723 | 26,713,206 | 24,807,535 | 496,517 | |||||||||||
Federal funds purchased and assets sold under agreements to repurchase | 762,145 | 1,085,765 | 1,271,657 | (323,620 | ) | ||||||||||
Other short-term borrowings | 1,200 | 1,200 | 21,200 | - | |||||||||||
Notes payable | 1,670,309 | 1,674,511 | 1,711,828 | (4,202 | ) | ||||||||||
Other liabilities | 1,019,018 | 1,004,676 | 1,012,029 | 14,342 | |||||||||||
Liabilities from discontinued operations | 1,815 | 1,800 | 5,064 | 15 | |||||||||||
Total liabilities | 30,664,210 | 30,481,158 | 28,829,313 | 183,052 | |||||||||||
Stockholders’ equity: | |||||||||||||||
Preferred stock | 50,160 | 50,160 | 50,160 | - | |||||||||||
Common stock | 1,038 | 1,037 | 1,036 | 1 | |||||||||||
Surplus | 4,229,156 | 4,200,805 | 4,196,458 | 28,351 | |||||||||||
Retained earnings | 1,087,957 | 993,309 | 253,717 | 94,648 | |||||||||||
Treasury stock | (6,101 | ) | (5,869 | ) | (4,117 | ) | (232 | ) | |||||||
Accumulated other comprehensive loss | (256,886 | ) | (189,806 | ) | (229,872 | ) | (67,080 | ) | |||||||
Total stockholders’ equity | 5,105,324 | 5,049,636 | 4,267,382 | 55,688 | |||||||||||
Total liabilities and stockholders’ equity | $35,769,534 | $35,530,794 | $33,096,695 | $238,740 | |||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||||||||||||||||||||||||||||||||||||
Table D - Consolidated Average Balances and Yield / Rate Analysis - QUARTER | ||||||||||||||||||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | Variance | Variance | ||||||||||||||||||||||||||||||||||||||||||
31-Dec-15 | 30-Sep-15 | 31-Dec-14 | Q4 2015 vs. Q3 2015 | Q4 2015 vs. Q4 2014 | ||||||||||||||||||||||||||||||||||||||||||
($ amounts in millions; yields not on a taxable equivalent basis) |
Average |
Income / |
Yield / |
Average |
Income / |
Yield / |
Average |
Income / |
Yield / |
Average |
Income / |
Yield / |
Average |
Income / |
Yield / |
|||||||||||||||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||||||||||||||||||||||||
Money market, trading and investment securities | $8,602 | $36.9 | 1.71 | % | $8,667 | $36.8 | 1.70 | % | $7,220 | $34.4 | 1.90 | % | ($65 | ) | $0.1 | 0.01 | % | $1,382 | $2.5 | (0.19 | ) | % | ||||||||||||||||||||||||
Loans not covered under loss-sharing agreements with the FDIC: | ||||||||||||||||||||||||||||||||||||||||||||||
Commercial | 8,936 | 107.4 | 4.77 | 8,769 | 109.6 | 4.96 | 8,219 | 101.9 | 4.92 | 167 | (2.2 | ) | (0.19 | ) | 717 | 5.5 | (0.15 | ) | ||||||||||||||||||||||||||||
Construction | 662 | 9.8 | 5.88 | 681 | 10.8 | 6.30 | 233 | 3.8 | 6.41 | (19 | ) | (1.0 | ) | (0.42 | ) | 429 | 6.0 | (0.53 | ) | |||||||||||||||||||||||||||
Mortgage | 6,947 | 90.6 | 5.22 | 7,072 | 88.8 | 5.02 | 6,538 | 84.1 | 5.15 | (125 | ) | 1.8 | 0.20 | 409 | 6.5 | 0.07 | ||||||||||||||||||||||||||||||
Consumer | 3,819 | 97.6 | 10.13 | 3,811 | 97.2 | 10.12 | 3,884 | 96.6 | 9.86 | 8 | 0.4 | 0.01 | (65 | ) | 1.0 | 0.27 | ||||||||||||||||||||||||||||||
Lease financing | 611 | 10.6 | 6.97 | 594 | 10.0 | 6.75 | 555 | 9.9 | 7.11 | 17 | 0.6 | 0.22 | 56 | 0.7 | (0.14 | ) | ||||||||||||||||||||||||||||||
Total loans (excluding WB loans) | 20,975 | 316.0 | 5.99 | 20,927 | 316.4 | 6.02 | 19,429 | 296.3 | 6.07 | 48 | (0.4 | ) | (0.03 | ) | 1,546 | 19.7 | (0.08 | ) | ||||||||||||||||||||||||||||
WB loans | 2,156 | 47.9 | 8.82 | 2,221 | 48.0 | 8.59 | 2,615 | 61.3 | 9.31 | (65 | ) | (0.1 | ) | 0.23 | (459 | ) | (13.4 | ) | (0.49 | ) | ||||||||||||||||||||||||||
Total loans | 23,131 | 363.9 | 6.26 | 23,148 | 364.4 | 6.26 | 22,044 | 357.6 | 6.45 | (17 | ) | (0.5 | ) | - | 1,087 | 6.3 | (0.19 | ) | ||||||||||||||||||||||||||||
Total interest earning assets | 31,733 | $400.8 | 5.02 | % | 31,815 | $401.2 | 5.02 | % | 29,264 | $392.0 | 5.33 | % | (82 | ) | ($0.4 | ) | - | % | 2,469 | $8.8 | (0.31 | ) | % | |||||||||||||||||||||||
Allowance for loan losses | (573 | ) | (559 | ) | (618 | ) | (14 | ) | 45 | |||||||||||||||||||||||||||||||||||||
Other non-interest earning assets | 4,416 | 4,584 | 4,171 | (168 | ) | 245 | ||||||||||||||||||||||||||||||||||||||||
Assets from discontinued operations | - | - | 491 | - | (491 | ) | ||||||||||||||||||||||||||||||||||||||||
Total average assets | $35,576 | $35,840 | $33,308 | $(264 | ) | $2,268 | ||||||||||||||||||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||||||||||||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||||||||||||||||||||||||
NOW and money market | $5,547 | $5.1 | 0.36 | % | $5,742 | $4.9 | 0.34 | % | $4,788 | $4.0 | 0.33 | % | $(195 | ) | $0.2 | 0.02 | % | $759 | $1.1 | 0.03 | % | |||||||||||||||||||||||||
Savings | 7,119 | 4.1 | 0.23 | 7,055 | 4.1 | 0.23 | 6,788 | 3.8 | 0.22 | 64 | - | - | 331 | 0.3 | 0.01 | |||||||||||||||||||||||||||||||
Time deposits | 8,192 | 19.2 | 0.93 | 8,158 | 19.4 | 0.94 | 7,409 | 17.7 | 0.95 | 34 | (0.2 | ) | (0.01 | ) | 783 | 1.5 | (0.02 | ) | ||||||||||||||||||||||||||||
Total interest bearing deposits | 20,858 | 28.4 | 0.54 | 20,955 | 28.4 | 0.54 | 18,985 | 25.5 | 0.53 | (97 | ) | - | - | 1,873 | 2.9 | 0.01 | ||||||||||||||||||||||||||||||
Borrowings[1] | 2,439 | 21.8 | 3.57 | 2,861 | 22.1 | 3.09 | 2,992 | 21.0 | 2.80 | (422 | ) | (0.3 | ) | 0.48 | (553 | ) | 0.8 | 0.77 | ||||||||||||||||||||||||||||
Total interest bearing liabilities | 23,297 | 50.2 | 0.86 | 23,816 | 50.5 | 0.84 | 21,977 | 46.5 | 0.84 | (519 | ) | (0.3 | ) | 0.02 | 1,320 | 3.7 | 0.02 | |||||||||||||||||||||||||||||
Net interest spread | 4.16 | % | 4.18 | % | 4.49 | % | (0.02 | ) | % | (0.33 | ) | % | ||||||||||||||||||||||||||||||||||
Non-interest bearing deposits | 6,246 | 6,144 | 5,636 | 102 | 610 | |||||||||||||||||||||||||||||||||||||||||
Other liabilities | 953 | 876 | 849 | 77 | 104 | |||||||||||||||||||||||||||||||||||||||||
Liabilities from discontinued operations | 2 | 2 | 486 | - | (484 | ) | ||||||||||||||||||||||||||||||||||||||||
Stockholders' equity | 5,078 | 5,002 | 4,360 | 76 | 718 | |||||||||||||||||||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $35,576 | $35,840 | $33,308 | $(264 | ) | $2,268 | ||||||||||||||||||||||||||||||||||||||||
Adjusted net interest income / margin non-taxable equivalent basis | $350.6 | 4.39 | % | $350.7 | 4.39 | % | $345.5 | 4.70 | % | ($0.1 | ) | - | % | $5.1 | (0.31 | ) | % | |||||||||||||||||||||||||||||
Doral fair value remeasurement adjustment | 1.9 | - | - | 1.9 | 1.9 | |||||||||||||||||||||||||||||||||||||||||
Impact of fees related to repos refinancing | - | - | 18.6 | - | (18.6 | ) | ||||||||||||||||||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $352.5 | 4.42 | % | $350.7 | 4.39 | % | $326.9 | 4.45 | % | $1.8 | 0.03 | % | $25.6 | (0.03 | ) | % | ||||||||||||||||||||||||||||||
(1) Borrowing expense for the fourth quarter of 2014, including the fees related to repos financing, was 5.27%. | ||||||||||||||||||||||||||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||||||||||||||||||
Table E - Consolidated Average Balances and Yield / Rate Analysis - YEAR-TO-DATE | ||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||
Year ended | Year ended | |||||||||||||||||||||||||||
31-Dec-15 | 31-Dec-14 | Variance | ||||||||||||||||||||||||||
Average | Income / | Yield / | Average | Income / | Yield / | Average | Income / | Yield / | ||||||||||||||||||||
($ amounts in millions; yields not on a taxable equivalent basis) | balance | Expense | Rate | balance | Expense | Rate | balance | Expense | Rate | |||||||||||||||||||
Assets: | ||||||||||||||||||||||||||||
Interest earning assets: | ||||||||||||||||||||||||||||
Money market, trading and investment securities | $8,406 | $144.3 | 1.72 | % | $7,530 | $154.8 | 2.06 | % | $876 | ($10.5 | ) | (0.34 | ) | % | ||||||||||||||
Loans not covered under loss-sharing agreements with the FDIC: | ||||||||||||||||||||||||||||
Commercial | 8,705 | 424.8 | 4.88 | 8,347 | 404.4 | 4.85 | 358 | 20.4 | 0.03 | |||||||||||||||||||
Construction | 616 | 36.7 | 5.96 | 199 | 13.5 | 6.78 | 417 | 23.2 | (0.82 | ) | ||||||||||||||||||
Mortgage | 6,978 | 360.4 | 5.16 | 6,641 | 340.4 | 5.12 | 337 | 20.0 | 0.04 | |||||||||||||||||||
Consumer | 3,824 | 387.2 | 10.13 | 3,861 | 386.7 | 10.01 | (37 | ) | 0.5 | 0.12 | ||||||||||||||||||
Lease financing | 589 | 40.8 | 6.91 | 548 | 40.1 | 7.33 | 41 | 0.7 | (0.42 | ) | ||||||||||||||||||
Total loans (excluding WB loans) | 20,712 | 1,249.9 | 6.03 | 19,596 | 1,185.1 | 6.05 | 1,116 | 64.8 | (0.02 | ) | ||||||||||||||||||
WB loans | 2,333 | 208.8 | 8.95 | 2,771 | 293.6 | 10.60 | (438 | ) | (84.8 | ) | (1.65 | ) | ||||||||||||||||
Total loans | 23,045 | 1,458.7 | 6.33 | 22,367 | 1,478.7 | 6.61 | 678 | (20.0 | ) | (0.28 | ) | |||||||||||||||||
Total interest earning assets | 31,451 | $1,603.0 | 5.10 | % | 29,897 | $1,633.5 | 5.46 | % | 1,554 | ($30.5 | ) | (0.36 | ) | % | ||||||||||||||
Allowance for loan losses | (585 | ) | (623 | ) | 38 | |||||||||||||||||||||||
Other non-interest earning assets | 4,320 | 4,466 | (146 | ) | ||||||||||||||||||||||||
Assets from discontinued operations | - | 1,442 | (1,442 | ) | ||||||||||||||||||||||||
Total average assets | $35,186 | $35,182 | $4 | |||||||||||||||||||||||||
Liabilities and Stockholders' Equity: | ||||||||||||||||||||||||||||
Interest bearing deposits: | ||||||||||||||||||||||||||||
NOW and money market | $5,447 | $19.0 | 0.35 | % | $4,824 | $15.5 | 0.32 | % | $623 | $3.5 | 0.03 | % | ||||||||||||||||
Savings | 7,027 | 16.2 | 0.23 | 6,733 | 14.7 | 0.22 | 294 | 1.5 | 0.01 | |||||||||||||||||||
Time deposits | 8,158 | 72.3 | 0.89 | 7,556 | 74.9 | 0.99 | 602 | (2.6 | ) | (0.10 | ) | |||||||||||||||||
Total interest bearing deposits | 20,632 | 107.5 | 0.52 | 19,113 | 105.1 | 0.55 | 1,519 | 2.4 | (0.03 | ) | ||||||||||||||||||
Borrowings [1] | 2,757 | 86.5 | 3.14 | 3,514 | 130.0 | 3.70 | (757 | ) | (43.5 | ) | (0.56 | ) | ||||||||||||||||
Total interest bearing liabilities | 23,389 | 194.0 | 0.83 | 22,627 | 235.1 | 1.04 | 762 | (41.1 | ) | (0.21 | ) | |||||||||||||||||
Net interest spread | 4.27 | % | 4.42 | % | (0.15 | ) | % | |||||||||||||||||||||
Non-interest bearing deposits | 6,147 | 5,534 | 613 | |||||||||||||||||||||||||
Other liabilities | 944 | 879 | 65 | |||||||||||||||||||||||||
Liabilities from discontinued operations | 2 | 1,586 | (1,584 | ) | ||||||||||||||||||||||||
Stockholders' equity | 4,704 | 4,556 | 148 | |||||||||||||||||||||||||
Total average liabilities and stockholders' equity | $35,186 | $35,182 | $4 | |||||||||||||||||||||||||
Adjusted net interest income / margin non-taxable equivalent basis | $1,409.0 | 4.48 | % | $1,398.4 | 4.67 | % | $10.6 | (0.19 | ) | % | ||||||||||||||||||
Impact of fees related to repos refinancing | - | 39.2 | (39.2 | ) | ||||||||||||||||||||||||
Accelerated amortization TARP discount and related deferred costs | - | 414.1 | (414.1 | ) | ||||||||||||||||||||||||
Net interest income / margin non-taxable equivalent basis | $1,409.0 | 4.48 | % | $945.1 | 3.16 | % | $463.9 | 1.32 | % | |||||||||||||||||||
(1) Borrowing expense for 2014 including the fees related to repo refinancing and the impact of the accelerated TARP amortization was 16.60%. | ||||||||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||||||||||
Table F - Mortgage Banking Activities and Other Service Fees | |||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
Mortgage Banking Activities | Variance | ||||||||||||||||||||||||
Quarters ended |
Q4 2015 vs. |
Q4 2015 vs. |
Years ended | Variance | |||||||||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | Q3 2015 | Q4 2014 | 31-Dec-15 | 31-Dec-14 |
2015 vs. 2014 |
|||||||||||||||||
Mortgage servicing fees, net of fair value adjustments: | |||||||||||||||||||||||||
Mortgage servicing fees | $15,504 | $17,020 | $9,364 | $(1,516 | ) | $6,140 | $59,461 | $41,761 | $17,700 | ||||||||||||||||
Mortgage servicing rights fair value adjustments | (2,096 | ) | 1,038 | (6,259 | ) | (3,134 | ) | 4,163 | (7,904 | ) | (24,683 | ) | 16,779 | ||||||||||||
Total mortgage servicing fees, net of fair value adjustments | 13,408 | 18,058 | 3,105 | (4,650 | ) | 10,303 | 51,557 | 17,078 | 34,479 | ||||||||||||||||
Net gain on sale of loans, including valuation on loans held-for-sale | 10,337 | 9,698 | 8,382 | 639 | 1,955 | 35,336 | 31,213 | 4,123 | |||||||||||||||||
Trading account loss: | |||||||||||||||||||||||||
Unrealized gains (losses) on outstanding derivative positions | 27 | (69 | ) | (1 | ) | 96 | 28 | 17 | (726 | ) | 743 | ||||||||||||||
Realized (losses) gains on closed derivative positions | (342 | ) | (3,492 | ) | (2,739 | ) | 3,150 | 2,397 | (5,108 | ) | (16,950 | ) | 11,842 | ||||||||||||
Total trading account loss | (315 | ) | (3,561 | ) | (2,740 | ) | 3,246 | 2,425 | (5,091 | ) | (17,676 | ) | 12,585 | ||||||||||||
Total mortgage banking activities | $23,430 | $24,195 | $8,747 | $(765 | ) | $14,683 | $81,802 | $30,615 | $51,187 | ||||||||||||||||
Other Service Fees | Variance | ||||||||||||||||||||||||
Quarters ended |
Q4 2015 vs. |
Q4 2015 vs. |
Years ended | Variance | |||||||||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | Q3 2015 | Q4 2014 | 31-Dec-15 | 31-Dec-14 |
2015 vs. 2014 |
|||||||||||||||||
Other service fees: | |||||||||||||||||||||||||
Debit card fees | $11,768 | $11,288 | $10,929 | $480 | $839 | $46,176 | $43,146 | $3,030 | |||||||||||||||||
Insurance fees | 23,813 | 14,517 | 17,711 | 9,296 | 6,102 | 63,976 | 54,158 | 9,818 | |||||||||||||||||
Credit card fees | 17,528 | 16,879 | 17,493 | 649 | 35 | 68,166 | 67,639 | 527 | |||||||||||||||||
Sale and administration of investment products | 5,578 | 5,737 | 7,193 | (159 | ) | (1,615 | ) | 23,846 | 27,711 | (3,865 | ) | ||||||||||||||
Trust fees | 4,947 | 4,403 | 4,469 | 544 | 478 | 18,866 | 18,209 | 657 | |||||||||||||||||
Other fees | 3,294 | 3,291 | 3,345 | 3 | (51 | ) | 15,060 | 14,402 | 658 | ||||||||||||||||
Total other service fees | $66,928 | $56,115 | $61,140 | $10,813 | $5,788 | $236,090 | $225,265 | $10,825 | |||||||||||||||||
Popular, Inc. | ||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||
Table G - Loans and Deposits | ||||||||||||
(Unaudited) | ||||||||||||
Loans - Ending Balances | ||||||||||||
Variance | ||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 |
Q4 2015 vs. |
Q4 2015 vs. |
|||||||
Loans not covered under FDIC loss-sharing agreements: | ||||||||||||
Commercial | $10,099,163 | $10,130,424 | $8,134,267 | $(31,261 | ) | $1,964,896 | ||||||
Construction | 681,106 | 692,492 | 251,820 | (11,386 | ) | 429,286 | ||||||
Legacy [1] | 64,436 | 67,974 | 80,818 | (3,538 | ) | (16,382 | ) | |||||
Lease financing | 627,650 | 606,927 | 564,389 | 20,723 | 63,261 | |||||||
Mortgage | 7,036,081 | 7,165,479 | 6,502,886 | (129,398 | ) | 533,195 | ||||||
Consumer | 3,837,679 | 3,834,770 | 3,870,271 | 2,909 | (32,592 | ) | ||||||
Total non-covered loans held-in-portfolio | $22,346,115 | $22,498,066 | $19,404,451 | $(151,951 | ) | $2,941,664 | ||||||
Loans covered under FDIC loss-sharing agreements | 646,115 | 665,428 | 2,542,662 | (19,313 | ) | (1,896,547 | ) | |||||
Total loans held-in-portfolio | $22,992,230 | $23,163,494 | $21,947,113 | $(171,264 | ) | $1,045,117 | ||||||
Loans held-for-sale: | ||||||||||||
Commercial | $45,074 | $47,447 | $309 | $(2,373 | ) | $44,765 | ||||||
Construction | 95 | 10 | - | 85 | 95 | |||||||
Legacy [1] | - | - | 319 | - | (319 | ) | ||||||
Mortgage | 91,831 | 123,562 | 100,166 | (31,731 | ) | (8,335 | ) | |||||
Consumer | - | - | 5,310 | - | (5,310 | ) | ||||||
Total loans held-for-sale | $137,000 | $171,019 | $106,104 | $(34,019 | ) | $30,896 | ||||||
Total loans | $23,129,230 | $23,334,513 | $22,053,217 | $(205,283 | ) | $1,076,013 | ||||||
[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) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 |
Q4 2015 vs. |
Q4 2015 vs. |
|||||||
Demand deposits [1] | $7,221,238 | $7,027,672 | $6,606,060 | $193,566 | $615,178 | |||||||
Savings, NOW and money market deposits (non-brokered) | 11,440,693 | 11,178,357 | 10,320,782 | 262,336 | 1,119,911 | |||||||
Savings, NOW and money market deposits (brokered) | 382,424 | 405,903 | 406,248 | (23,479 | ) | (23,824 | ) | |||||
Time deposits (non-brokered) | 7,274,157 | 6,870,816 | 5,960,401 | 403,341 | 1,313,756 | |||||||
Time deposits (brokered CDs) | 891,211 | 1,230,458 | 1,514,044 | (339,247 | ) | (622,833 | ) | |||||
Total deposits | $27,209,723 | $26,713,206 | $24,807,535 | $496,517 | $2,402,188 | |||||||
[1] Includes interest and non-interest bearing demand deposits. | ||||||||||||
Popular, Inc. | ||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||||||||||||
Table H - Non-Performing Assets | ||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
Variance | ||||||||||||||||||||||
(Dollars in thousands) | 31-Dec-15 |
As a % of |
30-Sep-15 |
As a % of |
31-Dec-14 |
As a % of |
Q4 2015 vs. |
Q4 2015 vs. |
||||||||||||||
Non-accrual loans: | ||||||||||||||||||||||
Commercial | $181,816 | 1.8 | % | $239,397 | 2.4 | % | $260,225 | 3.2 | % | $(57,581 | ) | $(78,409 | ) | |||||||||
Construction | 3,550 | 0.5 | 3,605 | 0.5 | 13,812 | 5.5 | (55 | ) | (10,262 | ) | ||||||||||||
Legacy [1] | 3,649 | 5.7 | 4,059 | 6.0 | 1,545 | 1.9 | (410 | ) | 2,104 | |||||||||||||
Lease financing | 3,009 | 0.5 | 3,091 | 0.5 | 3,102 | 0.5 | (82 | ) | (93 | ) | ||||||||||||
Mortgage | 351,471 | 5.0 | 343,410 | 4.8 | 304,913 | 4.7 | 8,061 | 46,558 | ||||||||||||||
Consumer | 58,304 | 1.5 | 41,340 | 1.1 | 46,886 | 1.2 | 16,964 | 11,418 | ||||||||||||||
Total non-performing loans held-in-portfolio, excluding covered loans |
601,799 | 2.7 | % | 634,902 | 2.8 | % | 630,483 | 3.3 | % | (33,103 | ) | (28,684 | ) | |||||||||
Non-performing loans held-for-sale [2] | 45,169 | 47,681 | 18,899 | (2,512 | ) | 26,270 | ||||||||||||||||
Other real estate owned (“OREO”), excluding covered OREO |
155,231 | 155,826 | 135,500 | (595 | ) | 19,731 | ||||||||||||||||
Total non-performing assets, excluding covered assets |
802,199 | 838,409 | 784,882 | (36,210 | ) | 17,317 | ||||||||||||||||
Covered loans and OREO | 40,571 | 39,888 | 148,099 | 683 | (107,528 | ) | ||||||||||||||||
Total non-performing assets | $842,770 | $878,297 | $932,981 | $(35,527 | ) | $(90,211 | ) | |||||||||||||||
Accruing loans past due 90 days or more [3] | $446,419 | $443,497 | $447,990 | $2,922 | $(1,571 | ) | ||||||||||||||||
Ratios excluding covered loans: | ||||||||||||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio |
2.69 |
% |
|
2.82 |
% |
|
3.25 |
% |
|
|||||||||||||
Allowance for loan losses to loans held-in-portfolio |
2.25 | 2.38 | 2.68 | |||||||||||||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale |
83.57 | 84.42 | 82.43 | |||||||||||||||||||
Ratios including covered loans: | ||||||||||||||||||||||
Non-performing assets to total assets | 2.36 |
% |
|
2.47 |
% |
|
2.82 |
% |
|
|||||||||||||
Non-performing loans held-in-portfolio to loans held-in-portfolio |
2.63 | 2.76 | 2.95 | |||||||||||||||||||
Allowance for loan losses to loans held-in-portfolio |
2.34 | 2.46 | 2.74 | |||||||||||||||||||
Allowance for loan losses to non-performing loans, excluding loans held-for-sale |
88.68 | 89.27 | 92.82 | |||||||||||||||||||
[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 December 31, 2015 consisted of $45 million in commercial loans and $95 thousand in construction loan (September 30, 2015 - $47 million in commercial loans, $10 thousand in construction loan and $224 thousand in mortgage loans; December 31, 2014 - $14.0 million in mortgage loans, $309 thousand in commercial loans and $4.5 million in consumer 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 non-performing since the principal repayment is insured. These balances include $164 million of residential mortgage loans insured by FHA or guaranteed by the VA that are no longer accruing interest as of December 31, 2015 (September 30, 2015 - $159 million; December 31, 2014 - $125 million). Furthermore, the Corporation has approximately $70 million in reverse mortgage loans which are guaranteed by FHA, but which are currently not accruing interest. Due to the guaranteed nature of the loans, it is the Corporation's policy to exclude these balances from non-performing assets (September 30, 2015 - $71 million; December 31, 2014 - $66 million). | ||||||||||||||||||||||
Popular, Inc. | |||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||||
Table I - Activity in Non-Performing Loans | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
Commercial loans held-in-portfolio: | |||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||
31-Dec-15 | 30-Sep-15 | ||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||
Beginning balance NPLs | $235,895 | $3,502 | $239,397 | $179,399 | $10,895 | $190,294 | |||||||||||||
Plus: | |||||||||||||||||||
New non-performing loans | 17,771 | 3,339 | 21,110 | 91,393 | 2,125 | 93,518 | |||||||||||||
Advances on existing non-performing loans | - | - | - | - | 6 | 6 | |||||||||||||
Less: | |||||||||||||||||||
Non-performing loans transferred to OREO | (852 | ) | - | (852 | ) | (853 | ) | - | (853 | ) | |||||||||
Non-performing loans charged-off | (44,423 | ) | (232 | ) | (44,655 | ) | (13,999 | ) | (229 | ) | (14,228 | ) | |||||||
Loans returned to accrual status / loan collections | (9,144 | ) | (2,222 | ) | (11,366 | ) | (20,045 | ) | (1,525 | ) | (21,570 | ) | |||||||
Loans transferred to held-for-sale | - | (473 | ) | (473 | ) | - | - | - | |||||||||||
Non-performing loans sold | (21,345 | ) | - | (21,345 | ) | - | - | - | |||||||||||
Other transfers out of non-performing | - | - | - | - | (7,770 | ) | (7,770 | ) | |||||||||||
Ending balance NPLs | $177,902 | $3,914 | $181,816 | $235,895 | $3,502 | $239,397 | |||||||||||||
Construction loans held-in-portfolio: | |||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||
31-Dec-15 | 30-Sep-15 | ||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||
Beginning balance NPLs | $3,605 | $- | $3,605 | $4,756 | $671 | $5,427 | |||||||||||||
Plus: | |||||||||||||||||||
New non-performing loans | 30 | 1,106 | 1,136 | - | 7,745 | 7,745 | |||||||||||||
Less: | |||||||||||||||||||
Non-performing loans charged-off | (47 | ) | - | (47 | ) | (91 | ) | - | (91 | ) | |||||||||
Loans returned to accrual status / loan collections | (38 | ) | (1,106 | ) | (1,144 | ) | (1,060 | ) | (8,416 | ) | (9,476 | ) | |||||||
Ending balance NPLs | $3,550 | $- | $3,550 | $3,605 | $- | $3,605 | |||||||||||||
Mortgage loans held-in-portfolio: | |||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||
31-Dec-15 | 30-Sep-15 | ||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||
Beginning balance NPLs | $331,022 | $12,388 | $343,410 | $318,773 | $12,048 | $330,821 | |||||||||||||
Plus: | |||||||||||||||||||
New non-performing loans | 85,208 | 7,208 | 92,416 | 93,768 | 5,816 | 99,584 | |||||||||||||
Less: | |||||||||||||||||||
Non-performing loans transferred to OREO | (8,860 | ) | (452 | ) | (9,312 | ) | (8,450 | ) | - | (8,450 | ) | ||||||||
Non-performing loans charged-off | (9,142 | ) | (300 | ) | (9,442 | ) | (15,212 | ) | (517 | ) | (15,729 | ) | |||||||
Loans returned to accrual status / loan collections | (60,295 | ) | (5,306 | ) | (65,601 | ) | (57,857 | ) | (4,959 | ) | (62,816 | ) | |||||||
Ending balance NPLs | $337,933 | $13,538 | $351,471 | $331,022 | $12,388 | $343,410 | |||||||||||||
Legacy loans held-in-portfolio: | |||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||
31-Dec-15 | 30-Sep-15 | ||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||
Beginning balance NPLs | $- | $4,059 | $4,059 | $- | $4,686 | $4,686 | |||||||||||||
Plus: | |||||||||||||||||||
New non-performing loans | - | 247 | 247 | - | 649 | 649 | |||||||||||||
Advances on existing non-performing loans | - | 9 | 9 | - | 89 | 89 | |||||||||||||
Less: | |||||||||||||||||||
Non-performing loans charged-off | - | (151 | ) | (151 | ) | - | (721 | ) | (721 | ) | |||||||||
Loans returned to accrual status / loan collections | - | (515 | ) | (515 | ) | - | (644 | ) | (644 | ) | |||||||||
Ending balance NPLs | $- | $3,649 | $3,649 | $- | $4,059 | $4,059 | |||||||||||||
Total non-performing loans held-in-portfolio (excluding consumer and covered loans): | |||||||||||||||||||
Quarter ended | Quarter ended | ||||||||||||||||||
31-Dec-15 | 30-Sep-15 | ||||||||||||||||||
(In thousands) | BPPR | BPNA | Popular, Inc. | BPPR | BPNA | Popular, Inc. | |||||||||||||
Beginning balance NPLs | $570,522 | $19,949 | $590,471 | $502,928 | $28,300 | $531,228 | |||||||||||||
Plus: | |||||||||||||||||||
New non-performing loans | 103,009 | 11,900 | 114,909 | 185,161 | 16,335 | 201,496 | |||||||||||||
Advances on existing non-performing loans | - | 9 | 9 | - | 95 | 95 | |||||||||||||
Less: | |||||||||||||||||||
Non-performing loans transferred to OREO | (9,712 | ) | (452 | ) | (10,164 | ) | (9,303 | ) | - | (9,303 | ) | ||||||||
Non-performing loans charged-off | (53,612 | ) | (683 | ) | (54,295 | ) | (29,302 | ) | (1,467 | ) | (30,769 | ) | |||||||
Loans returned to accrual status / loan collections | (69,477 | ) | (9,149 | ) | (78,626 | ) | (78,962 | ) | (15,544 | ) | (94,506 | ) | |||||||
Loans transferred to held-for-sale | - | (473 | ) | (473 | ) | - | - | - | |||||||||||
Non-performing loans sold | (21,345 | ) | - | (21,345 | ) | - | - | - | |||||||||||
Other transfers out of non-performing | - | - | - | - | (7,770 | ) | (7,770 | ) | |||||||||||
Ending balance NPLs | $519,385 | $21,101 | $540,486 | $570,522 | $19,949 | $590,471 | |||||||||||||
Popular, Inc. | |||||||||||||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||||||||||||||||||
Table J - Allowance for Credit Losses, Net Charge-offs and Related Ratios | |||||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||||
Quarter ended | Quarter ended | Quarter ended | |||||||||||||||||||||||||||||||
31-Dec-15 | 30-Sep-15 | 31-Dec-14 | |||||||||||||||||||||||||||||||
(Dollars in thousands) |
Non-covered |
Covered |
Total |
Non-covered |
Covered |
Total |
Non-covered |
Covered |
Total | ||||||||||||||||||||||||
Balance at beginning of period | $536,005 | $34,509 | $570,514 | $512,739 | $38,074 | $550,813 | $521,687 | $89,688 | $611,375 | ||||||||||||||||||||||||
Provision for loan losses - Continuing operations | 57,711 | 820 | 58,531 | 69,568 | (2,890 | ) | 66,678 | 51,637 | (3,646 | ) | 47,991 | ||||||||||||||||||||||
593,716 | 35,329 | 629,045 | 582,307 | 35,184 | 617,491 | 573,324 | 86,042 | 659,366 | |||||||||||||||||||||||||
Net loans charged-off (recovered): | |||||||||||||||||||||||||||||||||
BPPR | |||||||||||||||||||||||||||||||||
Commercial | 42,857 | - | 42,857 | 9,172 | - | 9,172 | 13,890 | 3,230 | 17,120 | ||||||||||||||||||||||||
Construction | 2,966 | - | 2,966 | (2,648 | ) | - | (2,648 | ) | (279 | ) | (1,172 | ) | (1,451 | ) | |||||||||||||||||||
Lease financing | 667 | - | 667 | 894 | - | 894 | 751 | - | 751 | ||||||||||||||||||||||||
Mortgage | 14,255 | 1,168 | 15,423 | 15,524 | 601 | 16,125 | 12,228 | 2,725 | 14,953 | ||||||||||||||||||||||||
Consumer | 21,266 | (15 | ) | 21,251 | 24,303 | 74 | 24,377 | 25,933 | (814 | ) | 25,119 | ||||||||||||||||||||||
Total BPPR | 82,011 | 1,153 | 83,164 | 47,245 | 675 | 47,920 | 52,523 | 3,969 | 56,492 | ||||||||||||||||||||||||
BPNA | |||||||||||||||||||||||||||||||||
Commercial | (525 | ) | - | (525 | ) | (1,959 | ) | - | (1,959 | ) | (900 | ) | - | (900 | ) | ||||||||||||||||||
Construction | - | - | - | - | - | - | (2 | ) | - | (2 | ) | ||||||||||||||||||||||
Legacy [1] | (359 | ) | - | (359 | ) | (603 | ) | - | (603 | ) | (3,877 | ) | - | (3,877 | ) | ||||||||||||||||||
Mortgage | 162 | - | 162 | 787 | - | 787 | (93 | ) | - | (93 | ) | ||||||||||||||||||||||
Consumer | 1,581 | - | 1,581 | 832 | - | 832 | 2,536 | - | 2,536 | ||||||||||||||||||||||||
Total BPNA | 859 | - | 859 | (943 | ) | - | (943 | ) | (2,336 | ) | - | (2,336 | ) | ||||||||||||||||||||
Total loans charged-off - Popular, Inc. | 82,870 | 1,153 | 84,023 | 46,302 | 675 | 46,977 | 50,187 | 3,969 | 54,156 | ||||||||||||||||||||||||
Net (write-downs) recoveries [2] | (7,911 | ) | - | (7,911 | ) | - | - | - | (3,418 | ) | - | (3,418 | ) | ||||||||||||||||||||
Balance at end of period | $502,935 | $34,176 | $537,111 | $536,005 | $34,509 | $570,514 | $519,719 | $82,073 | $601,792 | ||||||||||||||||||||||||
POPULAR, INC. | |||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 1.48 | % | 1.46 | % | 0.83 | % | 0.82 | % | 1.04 | % | 0.99 | % | |||||||||||||||||||||
Provision for loan losses to net charge-offs [3] | 0.70 | x | 0.70 | x | 1.50 | x | 1.42 | x | 0.99 | x | 0.85 | x | |||||||||||||||||||||
BPPR | |||||||||||||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 1.86 | % | 1.82 | % | 1.07 | % | 1.04 | % | 1.33 | % | 1.22 | % | |||||||||||||||||||||
Provision for loan losses to net charge-offs [3] | 0.68 | x | 0.68 | x | 1.46 | x | 1.37 | x | 0.99 | x | 0.86 | x | |||||||||||||||||||||
BPNA | |||||||||||||||||||||||||||||||||
Annualized net charge-offs (recoveries) to average loans held-in-portfolio | 0.07 | % | (0.08 | ) | % | (0.27 | ) | % | |||||||||||||||||||||||||
Provision for loan losses to net charge-offs | 2.42 | N.M. | N.M. | ||||||||||||||||||||||||||||||
[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] Net write-downs are related to loans sold or reclassified to held-for-sale. | |||||||||||||||||||||||||||||||||
[3] Excluding provision for loan losses and net write-down related to loans sold or reclassified to held-for-sale. | |||||||||||||||||||||||||||||||||
N.M. - Not meaningful. | |||||||||||||||||||||||||||||||||
Year ended | Year ended | |||||||||||||||||||||
(Dollars in thousands) | 31-Dec-15 | 31-Dec-14 | ||||||||||||||||||||
Non-covered |
Covered |
Total |
Non-covered |
Covered |
Total | |||||||||||||||||
Balance at beginning of period | $519,719 | $82,073 | $601,792 | $538,463 | $102,092 | $640,555 | ||||||||||||||||
Provision for loan losses - Continuing operations | 217,458 | 24,020 | 241,478 | 223,999 | 46,135 | 270,134 | ||||||||||||||||
Provision (reversal of provision) for loan losses - Discontinued operations | - | - | - | (6,764 | ) | - | (6,764 | ) | ||||||||||||||
737,177 | 106,093 | 843,270 | 755,698 | 148,227 | 903,925 | |||||||||||||||||
Net loans charged-off (recovered): | ||||||||||||||||||||||
BPPR | ||||||||||||||||||||||
Commercial | 73,890 | 31,432 | 105,322 | 39,382 | 32,906 | 72,288 | ||||||||||||||||
Construction | (886 | ) | 20,386 | 19,500 | (3,509 | ) | 27,686 | 24,177 | ||||||||||||||
Lease financing | 3,303 | - | 3,303 | 3,961 | - | 3,961 | ||||||||||||||||
Mortgage | 50,991 | 5,228 | 56,219 | 44,000 | 8,442 | 52,442 | ||||||||||||||||
Consumer | 83,876 | 11 | 83,887 | 96,655 | (2,880 | ) | 93,775 | |||||||||||||||
Total BPPR | 211,174 | 57,057 | 268,231 | 180,489 | 66,154 | 246,643 | ||||||||||||||||
BPNA | ||||||||||||||||||||||
Commercial | (3,842 | ) | - | (3,842 | ) | 1,105 | - | 1,105 | ||||||||||||||
Construction | - | - | - | (237 | ) | - | (237 | ) | ||||||||||||||
Legacy [1] | (2,760 | ) | - | (2,760 | ) | (9,070 | ) | - | (9,070 | ) | ||||||||||||
Mortgage | 1,279 | - | 1,279 | 1,196 | - | 1,196 | ||||||||||||||||
Consumer | 5,649 | - | 5,649 | 12,165 | - | 12,165 | ||||||||||||||||
Discontinued operations | - | - | - | (5,545 | ) | - | (5,545 | ) | ||||||||||||||
Total BPNA | 326 | - | 326 | (386 | ) | - | (386 | ) | ||||||||||||||
Total loans charged-off (recovered) - Popular, Inc. | 211,500 | 57,057 | 268,557 | 180,103 | 66,154 | 246,257 | ||||||||||||||||
Balance transferred from covered to non-covered loans | 13,037 | (13,037 | ) | - | - | - | - | |||||||||||||||
Net write-downs [3] | (35,779 | ) | (1,823 | ) | (37,602 | ) | (35,674 | ) | - | (35,674 | ) | |||||||||||
Net write-downs related to loans transferred to discontinued operations | - | - | - | (20,202 | ) | - | (20,202 | ) | ||||||||||||||
Balance at end of period | $502,935 | $34,176 | $537,111 | $519,719 | $82,073 | $601,792 | ||||||||||||||||
POPULAR, INC. | ||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 0.98 | % | 1.17 | % | 0.90 | % | 1.08 | % | ||||||||||||||
Provision for loan losses to net charge-offs [2] | 1.03 | x | 0.90 | x | 1.17 | x | 1.04 | x | ||||||||||||||
BPPR | ||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 1.24 | % | 1.45 | % | 1.14 | % | 1.33 | % | ||||||||||||||
Provision for loan losses to net charge-offs [2] | 1.03 | x | 0.90 | x | 1.38 | x | 1.20 | x | ||||||||||||||
BPNA | ||||||||||||||||||||||
Annualized net charge-offs to average loans held-in-portfolio | 0.01 | % | (0.01 | ) | % | |||||||||||||||||
Provision (reversal) for loan losses to net charge-offs | 1.92 | x | 102.57 | 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 loans sold or reclassified to held-for-sale during the years ended December 31, 2015 and December 31, 2014. | ||||||||||||||||||||||
[3] Net write-downs for the years ended December 31, 2015 and 2014 are related to loans sold or reclassified to held-for-sale. | ||||||||||||||||||||||
Popular, Inc. | ||||||||||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||||||||||||||||||||
Table K - Allowance for Loan Losses - Breakdown of General and Specific Reserves - CONSOLIDATED | ||||||||||||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||||||||||
31-Dec-15 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage |
Lease |
Consumer |
Total [2] |
|||||||||||||||||||||||
Specific ALLL | $49,243 | $264 | $- | $44,029 | $573 | $23,963 | $118,072 | |||||||||||||||||||||||
Impaired loans | [1] | $337,133 | $2,481 | $- | $471,932 | $2,404 | $111,836 | $925,786 | ||||||||||||||||||||||
Specific ALLL to impaired loans | [1] | 14.61 | % | 10.64 | % | - | % | 9.33 | % | 23.84 | % | 21.43 | % | 12.75 | % | |||||||||||||||
General ALLL | $147,590 | $8,605 | $2,687 | $89,283 | $10,420 | $126,278 | $384,863 | |||||||||||||||||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $9,762,030 | $678,625 | $64,436 | $6,564,149 | $625,246 | $3,725,843 | $21,420,329 | ||||||||||||||||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 1.51 | % | 1.27 | % | 4.17 | % | 1.36 | % | 1.67 | % | 3.39 | % | 1.80 | % | |||||||||||||||
Total ALLL | $196,833 | $8,869 | $2,687 | $133,312 | $10,993 | $150,241 | $502,935 | |||||||||||||||||||||||
Total non-covered loans held-in-portfolio | [1] | $10,099,163 | $681,106 | $64,436 | $7,036,081 | $627,650 | $3,837,679 | $22,346,115 | ||||||||||||||||||||||
ALLL to loans held-in-portfolio | [1] | 1.95 | % | 1.30 | % | 4.17 | % | 1.89 | % | 1.75 | % | 3.91 | % | 2.25 | % | |||||||||||||||
[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, 2015 the general allowance on the covered loans amounted to $34.2 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-Sep-15 | ||||||||||||||||||||||||||||||
(Dollars in thousands) | Commercial | Construction | Legacy [3] | Mortgage |
Lease |
Consumer |
Total [2] |
|||||||||||||||||||||||
Specific ALLL | $83,615 | $358 | $- | $47,545 | $634 | $24,696 | $156,848 | |||||||||||||||||||||||
Impaired loans | [1] | $391,066 | $2,536 | $1,188 | $462,806 | $2,645 | $113,865 | $974,106 | ||||||||||||||||||||||
Specific ALLL to impaired loans | [1] | 21.38 | % | 14.12 | % | - | % | 10.27 | % | 23.97 | % | 21.69 | % | 16.10 | % | |||||||||||||||
General ALLL | $146,846 | $14,393 | $2,805 | $86,955 | $8,457 | $119,701 | $379,157 | |||||||||||||||||||||||
Loans held-in-portfolio, excluding impaired loans | [1] | $9,739,358 | $689,956 | $66,786 | $6,702,673 | $604,282 | $3,720,905 | $21,523,960 | ||||||||||||||||||||||
General ALLL to loans held-in-portfolio, excluding impaired loans | [1] | 1.51 | % | 2.09 | % | 4.20 | % | 1.30 | % | 1.40 | % | 3.22 | % | 1.76 | % | |||||||||||||||
Total ALLL | $230,461 | $14,751 | $2,805 | $134,500 | $9,091 | $144,397 | $536,005 | |||||||||||||||||||||||
Total non-covered loans held-in-portfolio | [1] | $10,130,424 | $692,492 | $67,974 | $7,165,479 | $606,927 | $3,834,770 | $22,498,066 | ||||||||||||||||||||||
ALLL to loans held-in-portfolio | [1] | 2.27 | % | 2.13 | % | 4.13 | % | 1.88 | % | 1.50 | % | 3.77 | % | 2.38 | % | |||||||||||||||
[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, 2015 the general allowance on the covered loans amounted to $34.5 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 | $(34,372 | ) | $(94 | ) | $- | $(3,516 | ) | $(61 | ) | $(733 | ) | $(38,776 | ) | |||||||||||||||||
Impaired loans | $(53,933 | ) | $(55 | ) | $(1,188 | ) | $9,126 | $(241 | ) | $(2,029 | ) | $(48,320 | ) | |||||||||||||||||
General ALLL | $744 | $(5,788 | ) | $(118 | ) | $2,328 | $1,963 | $6,577 | $5,706 | |||||||||||||||||||||
Loans held-in-portfolio, excluding impaired loans | $22,672 | $(11,331 | ) | $(2,350 | ) | $(138,524 | ) | $20,964 | $4,938 | $(103,631 | ) | |||||||||||||||||||
Total ALLL | $(33,628 | ) | $(5,882 | ) | $(118 | ) | $(1,188 | ) | $1,902 | $5,844 | $(33,070 | ) | ||||||||||||||||||
Total non-covered loans held-in-portfolio | $(31,261 | ) | $(11,386 | ) | $(3,538 | ) | $(129,398 | ) | $20,723 | $2,909 | $(151,951 | ) | ||||||||||||||||||
Popular, Inc. | |||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||||
Table L - Allowance for Loan Losses - Breakdown of General and Specific Reserves - PUERTO RICO OPERATIONS | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
31-Dec-15 | |||||||||||||||||||
Puerto Rico | |||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage |
Lease financing |
Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL non-covered loans | $49,243 | $264 | $42,965 | $573 | $23,478 | $116,523 | |||||||||||||
General ALLL non-covered loans | 137,682 | 4,693 | 85,362 | 10,420 | 115,243 | 353,400 | |||||||||||||
ALLL - non-covered loans | 186,925 | 4,957 | 128,327 | 10,993 | 138,721 | 469,923 | |||||||||||||
Specific ALLL covered loans | - | - | - | - | - | - | |||||||||||||
General ALLL covered loans | - | - | 33,967 | - | 209 | 34,176 | |||||||||||||
ALLL - covered loans | - | - | 33,967 | - | 209 | 34,176 | |||||||||||||
Total ALLL | $186,925 | $4,957 | $162,294 | $10,993 | $138,930 | $504,099 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired non-covered loans | $337,133 | $2,481 | $465,117 | $2,404 | $109,660 | $916,795 | |||||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 7,031,086 | 98,467 | 5,662,374 | 625,246 | 3,236,642 | 16,653,815 | |||||||||||||
Non-covered loans held-in-portfolio | 7,368,219 | 100,948 | 6,127,491 | 627,650 | 3,346,302 | 17,570,610 | |||||||||||||
Impaired covered loans | - | - | - | - | - | - | |||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | - | - | 627,102 | - | 19,013 | 646,115 | |||||||||||||
Covered loans held-in-portfolio | - | - | 627,102 | - | 19,013 | 646,115 | |||||||||||||
Total loans held-in-portfolio | $7,368,219 | $100,948 | $6,754,593 | $627,650 | $3,365,315 | $18,216,725 | |||||||||||||
30-Sep-15 | |||||||||||||||||||
Puerto Rico | |||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL non-covered loans | $83,615 | $358 | $46,956 | $634 | $24,221 | $155,784 | |||||||||||||
General ALLL non-covered loans | 137,352 | 11,223 | 83,109 | 8,457 | 108,285 | 348,426 | |||||||||||||
ALLL - non-covered loans | 220,967 | 11,581 | 130,065 | 9,091 | 132,506 | 504,210 | |||||||||||||
Specific ALLL covered loans | - | - | - | - | - | - | |||||||||||||
General ALLL covered loans | - | - | 34,334 | - | 175 | 34,509 | |||||||||||||
ALLL - covered loans | - | - | 34,334 | - | 175 | 34,509 | |||||||||||||
Total ALLL | $220,967 | $11,581 | $164,399 | $9,091 | $132,681 | $538,719 | |||||||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired non-covered loans | $391,066 | $2,536 | $457,631 | $2,645 | $111,683 | $965,561 | |||||||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | 7,130,678 | 106,142 | 5,762,764 | 604,282 | 3,249,213 | 16,853,079 | |||||||||||||
Non-covered loans held-in-portfolio | 7,521,744 | 108,678 | 6,220,395 | 606,927 | 3,360,896 | 17,818,640 | |||||||||||||
Impaired covered loans | - | - | - | - | - | - | |||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | - | - | 645,663 | - | 19,765 | 665,428 | |||||||||||||
Covered loans held-in-portfolio | - | - | 645,663 | - | 19,765 | 665,428 | |||||||||||||
Total loans held-in-portfolio | $7,521,744 | $108,678 | $6,866,058 | $606,927 | $3,380,661 | $18,484,068 | |||||||||||||
|
|||||||||||||||||||
Variance | |||||||||||||||||||
(In thousands) | Commercial | Construction | Mortgage | Lease financing | Consumer | Total | |||||||||||||
Allowance for credit losses: | |||||||||||||||||||
Specific ALLL non-covered loans | $(34,372 | ) | $(94 | ) | $(3,991 | ) | $(61 | ) | $(743 | ) | $(39,261 | ) | |||||||
General ALLL non-covered loans | 330 | (6,530 | ) | 2,253 | 1,963 | 6,958 | 4,974 | ||||||||||||
ALLL - non-covered loans | (34,042 | ) | (6,624 | ) | (1,738 | ) | 1,902 | 6,215 | (34,287 | ) | |||||||||
Specific ALLL covered loans | - | - | - | - | - | - | |||||||||||||
General ALLL covered loans | - | - | (367 | ) | - | 34 | (333 | ) | |||||||||||
ALLL - covered loans | - | - | (367 | ) | - | 34 | (333 | ) | |||||||||||
Total ALLL | $(34,042 | ) | $(6,624 | ) | $(2,105 | ) | $1,902 | $6,249 | $(34,620 | ) | |||||||||
Loans held-in-portfolio: | |||||||||||||||||||
Impaired non-covered loans | $(53,933 | ) | $(55 | ) | $7,486 | $(241 | ) | $(2,023 | ) | $(48,766 | ) | ||||||||
Non-covered loans held-in-portfolio, excluding impaired loans | (99,592 | ) | (7,675 | ) | (100,390 | ) | 20,964 | (12,571 | ) | (199,264 | ) | ||||||||
Non-covered loans held-in-portfolio | (153,525 | ) | (7,730 | ) | (92,904 | ) | 20,723 | (14,594 | ) | (248,030 | ) | ||||||||
Impaired covered loans | - | - | - | - | - | - | |||||||||||||
Covered loans held-in-portfolio, excluding impaired loans | - | - | (18,561 | ) | - | (752 | ) | (19,313 | ) | ||||||||||
Covered loans held-in-portfolio | - | - | (18,561 | ) | - | (752 | ) | (19,313 | ) | ||||||||||
Total loans held-in-portfolio | $(153,525 | ) | $(7,730 | ) | $(111,465 | ) | $20,723 | $(15,346 | ) | $(267,343 | ) | ||||||||
Popular, Inc. | |||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||
Table M - Allowance for Loan Losses - Breakdown of General and Specific Reserves - U.S. MAINLAND OPERATIONS | |||||||||||||||||
(Unaudited) | |||||||||||||||||
31-Dec-15 | |||||||||||||||||
U.S. Mainland | |||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||
Allowance for credit losses: | |||||||||||||||||
Specific ALLL | $- | $- | $- | $1,064 | $485 | $1,549 | |||||||||||
General ALLL | 9,908 | 3,912 | 2,687 | 3,921 | 11,035 | 31,463 | |||||||||||
Total ALLL | $9,908 | $3,912 | $2,687 | $4,985 | $11,520 | $33,012 | |||||||||||
Loans held-in-portfolio: | |||||||||||||||||
Impaired loans | $- | $- | $- | $6,815 | $2,176 | $8,991 | |||||||||||
Loans held-in-portfolio, excluding impaired loans | 2,730,944 | 580,158 | 64,436 | 901,775 | 489,201 | 4,766,514 | |||||||||||
Total loans held-in-portfolio | $2,730,944 | $580,158 | $64,436 | $908,590 | $491,377 | $4,775,505 | |||||||||||
30-Sep-15 | |||||||||||||||||
U.S. Mainland | |||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||
Allowance for credit losses: | |||||||||||||||||
Specific ALLL | $- | $- | $- | $589 | $475 | $1,064 | |||||||||||
General ALLL | 9,494 | 3,170 | 2,805 | 3,846 | 11,416 | 30,731 | |||||||||||
Total ALLL | $9,494 | $3,170 | $2,805 | $4,435 | $11,891 | $31,795 | |||||||||||
Loans held-in-portfolio: | |||||||||||||||||
Impaired loans | $- | $- | $1,188 | $5,175 | $2,182 | $8,545 | |||||||||||
Loans held-in-portfolio, excluding impaired loans | 2,608,680 | 583,814 | 66,786 | 939,909 | 471,692 | 4,670,881 | |||||||||||
Total loans held-in-portfolio | $2,608,680 | $583,814 | $67,974 | $945,084 | $473,874 | $4,679,426 | |||||||||||
Variance | |||||||||||||||||
(In thousands) | Commercial | Construction | Legacy | Mortgage | Consumer | Total | |||||||||||
Allowance for credit losses: | |||||||||||||||||
Specific ALLL | $- | $- | $- | $475 | $10 | $485 | |||||||||||
General ALLL | 414 | 742 | (118 | ) | 75 | (381 | ) | 732 | |||||||||
Total ALLL | $414 | $742 | $(118 | ) | $550 | $(371 | ) | $1,217 | |||||||||
Loans held-in-portfolio: | |||||||||||||||||
Impaired loans | $- | $- | $(1,188 | ) | $1,640 | $(6 | ) | $446 | |||||||||
Loans held-in-portfolio, excluding impaired loans | 122,264 | (3,656 | ) | (2,350 | ) | (38,134 | ) | 17,509 | 95,633 | ||||||||
Total loans held-in-portfolio | $122,264 | $(3,656 | ) | $(3,538 | ) | $(36,494 | ) | $17,503 | $96,079 | ||||||||
Popular, Inc. | |||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||
Table N - Reconciliation to GAAP Financial Measures | |||||||||||
(Unaudited) | |||||||||||
(In thousands, except share or per share information) | 31-Dec-15 | 30-Sep-15 | 31-Dec-14 | ||||||||
Total stockholders’ equity | $5,105,324 | $5,049,636 | $4,267,382 | ||||||||
Less: Preferred stock | (50,160 | ) | (50,160 | ) | (50,160 | ) | |||||
Less: Goodwill | (626,388 | ) | (504,925 | ) | (465,676 | ) | |||||
Less: Other intangibles | (58,109 | ) | (71,393 | ) | (37,595 | ) | |||||
Total tangible common equity | $4,370,667 | $4,423,158 | $3,713,951 | ||||||||
Total assets | $35,769,534 | $35,530,794 | $33,096,695 | ||||||||
Less: Goodwill | (626,388 | ) | (504,925 | ) | (465,676 | ) | |||||
Less: Other intangibles | (58,109 | ) | (71,393 | ) | (37,595 | ) | |||||
Total tangible assets | $35,085,037 | $34,954,476 | $32,593,424 | ||||||||
Tangible common equity to tangible assets | 12.46 | % | 12.65 | % | 11.39 | % | |||||
Common shares outstanding at end of period | 103,618,976 | 103,556,285 | 103,476,847 | ||||||||
Tangible book value per common share | $42.18 | $42.71 | $35.89 | ||||||||
Popular, Inc. | ||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||
Table O - Financial Information - Westernbank Loans | ||||||||||
(Unaudited) | ||||||||||
Revenues | ||||||||||
Quarters ended | ||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | Variance | |||||||
Interest income on WB loans | $47,870 | $47,982 | $(112 | ) | ||||||
FDIC loss-share (expense) income: | ||||||||||
Amortization of indemnification asset | (3,926 | ) | (3,931 | ) | 5 | |||||
80% mirror accounting on credit impairment losses (reversal) [1] | (52 | ) | (183 | ) | 131 | |||||
80% mirror accounting on reimbursable expenses | 2,654 | 6,276 | (3,622 | ) | ||||||
80% mirror accounting on recoveries on covered assets, including rental income on OREOs, subject to reimbursement to the FDIC |
(6,014 | ) | - | (6,014 | ) | |||||
Change in true-up payment obligation | 2,782 | (1,058 | ) | 3,840 | ||||||
Other | 197 | 103 | 94 | |||||||
Total FDIC loss-share (expense) income | (4,359 | ) | 1,207 | (5,566 | ) | |||||
Total revenues | 43,511 | 49,189 | (5,678 | ) | ||||||
Provision for loan losses | 7,817 | 20,206 | (12,389 | ) | ||||||
Total revenues less provision for loan losses | $35,694 | $28,983 | $6,711 | |||||||
[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 [2] | ||||||||||
(In thousands) | [1] 31-Dec-15 | 30-Sep-15 | Variance | |||||||
Professional fees | $6,315 | $4,606 | $1,709 | |||||||
OREO expenses | 1,911 | 2,033 | (122 | ) | ||||||
Other operating expenses | 2,603 | 3,842 | (1,239 | ) | ||||||
Total operating expenses | $10,829 | $10,481 | $348 | |||||||
[1] | Includes expenses related to loans subject to the FDIC loss-sharing agreement and loans not subject to the FDIC loss-sharing agreement. | |||||||||
[2] | 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-Dec-15 | 30-Sep-15 | Variance | |||||||
Loans | $2,156 | $2,221 | $(65 | ) | ||||||
FDIC loss-share asset | 303 | 330 | (27 | ) | ||||||
Activity in the carrying amount and accretable yield of loans accounted for under ASC 310-30 | ||||||||||||||||
Quarters ended | ||||||||||||||||
31-Dec-15 | 30-Sep-15 | |||||||||||||||
(In thousands) | Accretable yield |
Carrying amount |
Accretable yield |
Carrying amount |
||||||||||||
Beginning balance | $1,145,449 | $2,076,012 | $1,245,924 | $2,137,078 | ||||||||||||
Accretion | (46,582 | ) | 46,582 | (46,693 | ) | 46,693 | ||||||||||
Changes in expected cash flows | 13,591 | - | (53,782 | ) | - | |||||||||||
Collections / charge-offs | - | (148,093 | ) | - | (107,759 | ) | ||||||||||
Ending balance | 1,112,458 | 1,974,501 | 1,145,449 | 2,076,012 | ||||||||||||
Allowance for loan losses - ASC 310-30 loans | - | (63,563 | ) | - | (64,583 | ) | ||||||||||
Ending balance, net of allowance for loan losses | $1,112,458 | $1,910,938 | $1,145,449 | $2,011,429 | ||||||||||||
The carrying amount of loans acquired from Westernbank and accounted for under ASC 310-30 which remain subject to the loss-sharing agreement with the FDIC amounted to approximately $636 million as of December 31, 2015. | ||||||||||||||||
Activity in the carrying amount of the FDIC indemnity asset | ||||||||||||||||
Quarters ended | ||||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | ||||||||||||||
Balance at beginning of period | $311,946 | $392,947 | ||||||||||||||
Amortization | (3,926 | ) | (3,931 | ) | ||||||||||||
Credit impairment losses (reversal) to be covered under loss-sharing agreements | (52 | ) | (183 | ) | ||||||||||||
Reimbursable expenses to be covered under loss-sharing agreements | 2,654 | 6,276 | ||||||||||||||
Net payments from FDIC under loss-sharing agreements | (2,560 | ) | (80,993 | ) | ||||||||||||
Other adjustments attributable to FDIC loss-sharing agreements | 2,159 | (2,170 | ) | |||||||||||||
Balance at end of period | $310,221 | $311,946 | ||||||||||||||
Activity in the remaining FDIC loss-share asset amortization | ||||||||||||||||
Quarters ended | ||||||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | ||||||||||||||
Balance at beginning of period | $27,367 | $28,493 | ||||||||||||||
Amortization | (3,926 | ) | (3,931 | ) | ||||||||||||
Impact of lower projected losses | 2,659 | 2,805 | ||||||||||||||
Balance at end of period | $26,100 | $27,367 | ||||||||||||||
POPULAR, INC. | ||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | ||||||||||||
Table P - Restructuring Charges | ||||||||||||
(Unaudited) | ||||||||||||
Restructuring Charges | ||||||||||||
Quarters ended | ||||||||||||
(In thousands) | 31-Dec-15 | 30-Sep-15 | Variance | |||||||||
Personnel costs | $ | 209 | $ | 496 | $ | (287 | ) | |||||
Net occupancy expenses | 222 | 208 | 14 | |||||||||
Equipment expenses | 8 | 15 | (7 | ) | ||||||||
Professional fees | 349 | (406 | ) | 755 | ||||||||
Other operating expenses | 216 | 168 | 48 | |||||||||
Total restructuring costs | $ | 1,004 | $ | 481 | $ | 523 | ||||||
Popular, Inc. | |||||||||||||||||||||||||||||||
Financial Supplement to Fourth Quarter 2015 Earnings Release | |||||||||||||||||||||||||||||||
Table Q - Adjusted Consolidated Statement of Operations for the Years Ended December 31, 2015 and 2014 (Non-GAAP) | |||||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||||
Year ended | |||||||||||||||||||||||||||||||
31-Dec-15 | |||||||||||||||||||||||||||||||
(In thousands) |
Actual |
BPNA |
Doral |
OTTI [4] |
Reversal |
Loss on |
Adjustment to |
MSRs |
Impairment of |
Bulk Sale |
Adjusted |
||||||||||||||||||||
Net interest income | $1,408,983 | $- | $- | $- | $- | $- | $- | $- | $- | $- | $1,408,983 | ||||||||||||||||||||
Provision for loan losses – non-covered loans | 217,458 | - | - | - | - | - | - | - | 15,190 | 5,852 | 196,416 | ||||||||||||||||||||
Provision for loan losses – covered loans [1] | 24,020 | - | - | - | - | - | - | - | - | - | 24,020 | ||||||||||||||||||||
Net interest income after provision for loan losses | 1,167,505 | - | - | - | - | - | - | - | (15,190 | ) | (5,852 | ) | 1,188,547 | ||||||||||||||||||
Mortgage banking activities | 81,802 | - | 844 | - | - | - | - | 4,378 | - | - | 76,580 | ||||||||||||||||||||
Other-than-temporary impairment losses on investment securities | (14,445 | ) | - | - | (14,445 | ) | - | - | - | - | - | - | - | ||||||||||||||||||
FDIC loss-share (expense) income | 20,062 | - | - | - | - | 17,566 | (10,887 | ) | - | - | - | 13,383 | |||||||||||||||||||
Other non-interest income | 432,122 | - | 2,072 | - | - | - | - | - | - | 430,050 | |||||||||||||||||||||
Total non-interest income | 519,541 | - | 2,916 | (14,445 | ) | - | 17,566 | (10,887 | ) | 4,378 | - | - | 520,013 | ||||||||||||||||||
Personnel costs | 477,519 | - | 7,103 | - | - | - | - | - | - | - | 470,416 | ||||||||||||||||||||
Net occupancy expenses | 86,888 | - | 4,103 | - | - | - | - | - | - | - | 82,785 | ||||||||||||||||||||
Equipment expenses | 60,110 | - | 725 | - | - | - | - | - | - | - | 59,385 | ||||||||||||||||||||
Professional fees | 308,985 | - | 15,481 | - | - | - | - | - | - | - | 293,504 | ||||||||||||||||||||
Communications | 25,146 | - | 70 | - | - | - | - | - | - | - | 25,076 | ||||||||||||||||||||
Business promotion | 52,076 | - | 501 | - | - | - | - | - | - | - | 51,575 | ||||||||||||||||||||
Other real estate owned (OREO) expenses | 85,568 | - | - | - | - | 21,957 | - | - | - | - | 63,611 | ||||||||||||||||||||
Amortization of intangibles | 11,019 | - | - | - | - | - | - | - | - | - | 11,019 | ||||||||||||||||||||
Restructuring costs | 18,412 | 18,412 | - | - | - | - | - | - | - | - | - | ||||||||||||||||||||
Other operating expenses | 162,498 | - | 509 | - | - | - | - | - | - | - | 161,989 | ||||||||||||||||||||
Total operating expenses | 1,288,221 | 18,412 | 28,492 | - | - | 21,957 | - | - | - | - | 1,219,360 | ||||||||||||||||||||
Income (loss) from continuing operations before income tax | 398,825 | (18,412 | ) | (25,576 | ) | (14,445 | ) | - | (4,391 | ) | (10,887 | ) | 4,378 | (15,190 | ) | (5,852 | ) | 489,200 | |||||||||||||
Income tax (benefit) expense | (495,172 | ) | - | (7,690 | ) | (2,486 | ) | (589,030 | ) | (1,712 | ) | (2,177 | ) | 1,707 | (5,924 | ) | (2,282 | ) | 114,422 | ||||||||||||
Income (loss) from continuing operations | $893,997 | $(18,412 | ) | $(17,886 | ) | $(11,959 | ) | $589,030 | $(2,679 | ) | $(8,710 | ) | $2,671 | $(9,266 | ) | $(3,570 | ) | $374,778 | |||||||||||||
Income from discontinued operations, net of tax | $1,347 | $1,347 | $- | $- | $- | $- | $- | $- | $- | $- | - | ||||||||||||||||||||
Net income (loss) | $895,344 | $(17,065 | ) | $(17,886 | ) | $(11,959 | ) | $589,030 | $(2,679 | ) | $(8,710 | ) | $2,671 | $(9,266 | ) | $(3,570 | ) | $374,778 | |||||||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under an FDIC loss-sharing agreement. | |||||||||||||||||||||||||||||||
[2] Represents restructuring charges associated with the reorganization of BPNA. | |||||||||||||||||||||||||||||||
[3] Includes approximately $0.8 million of fees charged for loan servicing cost to the FDIC, $2.1 million of fees charged for services provided to the alliance co-bidders, personnel costs related to former Doral Bank employees retained on a temporary basis and incentive compensation for an aggregate of $7.1 million, building rent expense of Doral Bank’s administrative offices for $4.1 million, professional fees and business promotion expenses directly associated with the Doral Bank Transaction and systems conversion for $16.0 million and other expenses, including equipment, business promotions and communications, of $1.3 million. | |||||||||||||||||||||||||||||||
[4] Represents an other than temporary impairment (“OTTI”) recorded on Puerto Rico government investment securities available-for-sale. These securities had an amortized cost of approximately $41.1 million and a market value of $26.6 million. Based on the fiscal and economic situation in Puerto Rico, together with the government’s announcements regarding its ability to pay its debt, the Corporation determined that the unrealized loss, a portion of which had been in an unrealized loss for a period exceeding twelve months, was other than temporary. | |||||||||||||||||||||||||||||||
[5] Represents the partial reversal of the valuation allowance of a portion of the deferred tax asset amounting to approximately $1.2 billion, at the U.S. operations. | |||||||||||||||||||||||||||||||
[6] Represents the loss on a bulk sale of covered OREOs completed in the second quarter and the related mirror accounting of the 80% reimbursable from the FDIC. | |||||||||||||||||||||||||||||||
[7] The quarter’s negative amortization of the FDIC’s Indemnification Asset included a $10.9 million expense related to losses incurred by the corporation that were not claimed to the FDIC before the expiration of the loss-share portion of the agreement on June 30, 2015, and that are not subject to the ongoing arbitrations. | |||||||||||||||||||||||||||||||
[8] Represents the fair value of mortgage servicing rights acquired for a portfolio previously serviced by Doral Bank, for which the Corporation acted as a backup servicer, under a pre-existing contract. | |||||||||||||||||||||||||||||||
[9] Represents impairment based on the estimated fair value of loans acquired from Westernbank, that the Corporation has the intent to sell and are subject to the ongoing arbitration with the FDIC. | |||||||||||||||||||||||||||||||
[10] Represents the impact of a bulk sale of loans at the BPPR segment, which had a book value of approximately $34.4 million. | |||||||||||||||||||||||||||||||
Year ended | ||||||||||||||||||||||||
31-Dec-14 | ||||||||||||||||||||||||
(In thousands) |
Actual |
TARP |
BPNA |
Income Tax |
Indemnification |
Other |
Adjusted |
|||||||||||||||||
Net interest income | $945,072 | $(414,068 | ) | $(39,254 | ) | $- | $- | $- | $1,398,394 | |||||||||||||||
Provision for loan losses – non-covered loans | 223,999 | - | 12,828 | - | - | - | 211,171 | |||||||||||||||||
Provision for loan losses – covered loans [1] | 46,135 | - | - | - | - | - | 46,135 | |||||||||||||||||
Net interest income after provision for loan losses | 674,938 | (414,068 | ) | (52,082 | ) | - | - | - | 1,141,088 | |||||||||||||||
Mortgage banking activities | 30,615 | - | - | - | - | - | 30,615 | |||||||||||||||||
Net gain on sale of loans, including valuation adjustments on loans held-for-sale | 40,591 | - | 1,684 | - | - | - | 38,907 | |||||||||||||||||
FDIC loss-share income (expense) | (103,024 | ) | - | - | - | 12,492 | - | (115,516 | ) | |||||||||||||||
Other non-interest income | 418,333 | - | - | - | - | - | 418,333 | |||||||||||||||||
Total non-interest income | 386,515 | - | 1,684 | - | 12,492 | - | 372,339 | |||||||||||||||||
Personnel costs | 418,679 | - | - | - | - | 2,974 | 415,705 | |||||||||||||||||
Net occupancy expenses | 86,707 | - | - | - | - | 1,895 | 84,812 | |||||||||||||||||
Equipment expenses | 48,917 | - | - | - | - | - | 48,917 | |||||||||||||||||
Loss on early extinguishment of debt | 532 | - | 532 | - | - | - | - | |||||||||||||||||
Professional fees | 282,055 | - | - | - | - | - | 282,055 | |||||||||||||||||
Communications | 25,684 | - | - | - | - | - | 25,684 | |||||||||||||||||
Business promotion | 54,016 | - | - | - | - | - | 54,016 | |||||||||||||||||
Other real estate owned (OREO) expenses | 49,611 | - | - | - | - | - | 49,611 | |||||||||||||||||
Restructuring costs | 26,725 | - | 26,725 | - | - | - | - | |||||||||||||||||
Other operating expenses | 200,758 | - | - | - | - | - | 200,758 | |||||||||||||||||
Total operating expenses | 1,193,684 | - | 27,257 | - | - | 4,869 |
1,161,558 |
|||||||||||||||||
(Loss) income from continuing operations before income tax | (132,231 | ) | (414,068 | ) | (77,655 | ) | - | 12,492 | (4,869 | ) | 351,869 | |||||||||||||
Income tax expense | 58,279 | (15,393 | ) | - | 20,048 | 2,498 | - | 51,126 | ||||||||||||||||
(Loss) income from continuing operations | $(190,510 | ) | $(398,675 | ) | $(77,655 | ) | $(20,048 | ) | $9,994 | $(4,869 | ) | $300,743 | ||||||||||||
(Loss) income from discontinued operations, net of tax | $(122,980 | ) | $- | $(122,980 | ) | $- | $- | $- | $- | |||||||||||||||
Net (loss) income |
$(313,490 | ) | $(398,675 | ) | $(200,635 | ) | $(20,048 | ) | $9,994 | $(4,869 | ) | $300,743 | ||||||||||||
[1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under an FDIC loss-sharing agreement. | ||||||||||||||||||||||||
[2] Income tax adjustments include a benefit of approximately $23.4 million related to a Closing Agreement with the PR Department of Treasury, completed during the second quarter of 2014 and the negative impact of the deferred tax asset valuation allowance of approximately $8.0 million recorded at the Holding Company, due to the difference in the tax treatment of the interest expense related to the TARP funds and the newly issued $450 million senior notes. | ||||||||||||||||||||||||
[3] Includes the aggregated impact of $39.8 million refinancing fees of structured repos, net loss of $11.1 million in bulk loan sales and $26.7 million in restructuring incurred in connection with the reorganization of PCB. | ||||||||||||||||||||||||
[4] On July 1, 2014, the Government of Puerto Rico approved an amendment to the Internal Revenue Code, which , among other things, changed the income tax rate for capital gains for 15% to 20%. As a result, the Corporation recognized an income tax expense of $20.0 million, mainly related to the deferred tax liability associated with the portfolio acquired from Westernbank. | ||||||||||||||||||||||||
[5] The FDIC indemnity asset amortization included a positive adjustment of $12.5 million to reverse the impact of accelerated amortization expense recorded in prior periods. | ||||||||||||||||||||||||
[6] Represents the impact of the compensation package granted upon separation of an officer of the Corporation equal to approximately $3.0 million and represents the net loss on the early cancellation of a lease at BPNA $1.9 million. |
CONTACT:
Popular, Inc.
Investor Relations:
Brett
Scheiner, 212-417-6721
Investor Relations Officer
BScheiner@BPOP.com
or
Media
Relations:
Teruca Rullán, 787-281-5170
Mobile:
917-679-3596
Senior Vice President, Corporate Communications