Stockholders' equity

6 Months Ended

Jun. 30, 2011

Stockholders' equity

Note 18 – Stockholders’ equity

BPPR statutory reserve

The Banking Act of the Commonwealth of Puerto Rico requires that a minimum of 10% of BPPR’s net income for the year be transferred to a statutory reserve account until such statutory reserve equals the total of paid-in capital on common and preferred stock. Any losses incurred by a bank must first be charged to retained earnings and then to the reserve fund. Amounts credited to the reserve fund may not be used to pay dividends without the prior consent of the Puerto Rico Commissioner of Financial Institutions. The failure to maintain sufficient statutory reserves would preclude BPPR from paying dividends. BPPR’s statutory reserve fund totaled $402 million at June 30, 2011 (December 31, 2010 - $402 million; June 30, 2010 - $402 million). There were no transfers between the statutory reserve account and the retained earnings account during the six months ended June 30, 2011 and June 30, 2010.