For a summary of the accounting policies related to loans, interest recognition and allowance for loan losses refer to Note 2 - Summary of Significant Accounting Policies of the 2018 Form 10-K.

As previously disclosed in Note 4, as a result of the Reliable Transaction completed on August 1, 2018, Popular Auto, LLC, acquired approximately $1.6 billion in retail auto loans and $341 million in primarily auto-related commercial loans. These loans are included in the information presented in this note.

During the quarter ended March 31, 2019, the Corporation recorded purchases (including repurchases) of mortgage loans amounting to $81 million and consumer loans of $69 million, compared to purchases (including repurchases) of mortgage loans of $156 million and consumer loans of $51 million, during the quarter ended March 31, 2018.

The Corporation performed whole-loan sales involving approximately $12 million of residential mortgage loans and $8 million of commercial loans during the quarter ended March 31, 2019 (March 31, 2018 - $10 million of residential mortgage loans). Also, during the quarter ended March 31, 2019, the Corporation securitized approximately $71 million of mortgage loans into Government National Mortgage Association (“GNMA”) mortgage-backed securities and $21 million of mortgage loans into Federal National Mortgage Association (“FNMA”) mortgage-backed securities, compared to $112 million and $26 million, respectively, during the quarter ended March 31, 2018.

Delinquency status

The following table presents the composition of loans held-in-portfolio (“HIP”), net of unearned income, by past due status, and by loan class including those that are in non-performing status or that are accruing interest but are past due 90 days or more at March 31, 2019 and December 31, 2018.

March 31, 2019
Puerto Rico

			Past due											Past due 90 days or more
		30-59		60-89		90 days		Total						Non-accrual			Accruing
(In thousands)		days		days		or more		past due		Current		Loans HIP		loans		loans^[1]
Commercial multi-family		$	729	$	1,347	$	692	$	2,768	$	150,494	$	153,262	$	646	$	-
Commercial real estate:
	Non-owner occupied		12,605		21,432		91,872		125,909		2,174,869		2,300,778		38,189		-
	Owner occupied		14,279		3,350		99,557		117,186		1,573,993		1,691,179		83,607		-
Commercial and industrial			4,473		435		44,148		49,056		3,196,847		3,245,903		43,851		297
Construction			-		-		1,788		1,788		89,584		91,372		1,788		-
Mortgage			278,233		131,178		974,718		1,384,129		4,991,459		6,375,588		317,850		532,809
Leasing			8,202		2,409		2,525		13,136		950,096		963,232		2,525		-
Consumer:
	Credit cards		9,732		6,093		16,639		32,464		983,124		1,015,588		-		16,639
	Home equity lines of credit		6		58		-		64		4,835		4,899		-		-
	Personal		12,180		8,506		17,760		38,446		1,233,178		1,271,624		17,178		62
	Auto		57,106		10,955		25,172		93,233		2,648,862		2,742,095		25,162		10
	Other		1,598		468		15,013		17,079		123,751		140,830		14,196		817
Total		$	399,143	$	186,231	$	1,289,884	$	1,875,258	$	18,121,092	$	19,996,350	$	544,992	$	550,634
[1]	Loans HIP of $194 million accounted for under ASC Subtopic 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.

March 31, 2019
Popular U.S.

			Past due											Past due 90 days or more
		30-59		60-89		90 days		Total						Non-accrual			Accruing
(In thousands)		days		days		or more		past due		Current		Loans HIP		loans		loans^[1]
Commercial multi-family		$	1,197	$	2,555	$	-	$	3,752	$	1,388,268	$	1,392,020	$	-	$	-
Commercial real estate:
	Non-owner occupied		2,329		-		-		2,329		1,851,166		1,853,495		-		-
	Owner occupied		4,775		-		2,064		6,839		306,708		313,547		2,064		-
Commercial and industrial			1,237		50		63,588		64,875		1,043,251		1,108,126		797		-
Construction			10,343		-		12,060		22,403		677,545		699,948		12,060		-
Mortgage			14,328		1,241		9,808		25,377		806,215		831,592		9,808		-
Legacy			61		13		2,583		2,657		21,747		24,404		2,583		-
Consumer:
	Credit cards		-		-		2		2		33		35		2		-
	Home equity lines of credit		451		388		12,087		12,926		119,956		132,882		12,087		-
	Personal		1,957		1,301		1,809		5,067		290,041		295,108		1,809		-
	Other		4		6		-		10		191		201		-		-
Total		$	36,682	$	5,554	$	104,001	$	146,237	$	6,505,121	$	6,651,358	$	41,210	$	-
[1]	Loans HIP of $63 million accounted for under ASC Subtopic 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.

March 31, 2019
Popular, Inc.

			Past due											Past due 90 days or more
		30-59		60-89		90 days		Total						Non-accrual			Accruing
(In thousands)		days		days		or more		past due		Current		Loans HIP^{[3] [4]}		loans		loans^[5]
Commercial multi-family		$	1,926	$	3,902	$	692	$	6,520	$	1,538,762	$	1,545,282	$	646	$	-
Commercial real estate:
	Non-owner occupied		14,934		21,432		91,872		128,238		4,026,035		4,154,273		38,189		-
	Owner occupied		19,054		3,350		101,621		124,025		1,880,701		2,004,726		85,671		-
Commercial and industrial			5,710		485		107,736		113,931		4,240,098		4,354,029		44,648		297
Construction			10,343		-		13,848		24,191		767,129		791,320		13,848		-
Mortgage^[1]			292,561		132,419		984,526		1,409,506		5,797,674		7,207,180		327,658		532,809
Leasing			8,202		2,409		2,525		13,136		950,096		963,232		2,525		-
Legacy^[2]			61		13		2,583		2,657		21,747		24,404		2,583		-
Consumer:
	Credit cards		9,732		6,093		16,641		32,466		983,157		1,015,623		2		16,639
	Home equity lines of credit		457		446		12,087		12,990		124,791		137,781		12,087		-
	Personal		14,137		9,807		19,569		43,513		1,523,219		1,566,732		18,987		62
	Auto		57,106		10,955		25,172		93,233		2,648,862		2,742,095		25,162		10
	Other		1,602		474		15,013		17,089		123,942		141,031		14,196		817
Total		$	435,825	$	191,785	$	1,393,885	$	2,021,495	$	24,626,213	$	26,647,708	$	586,202	$	550,634

[1]	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.
[2]	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 Popular U.S. segment.
[3]	Loans held-in-portfolio are net of $161 million in unearned income and exclude $44 million in loans held-for-sale.
[4]	Includes $6.6 billion pledged to secure credit facilities and public funds that the secured parties are not permitted to sell or repledge the collateral, of which $4.6 billion were pledged at the Federal Home Loan Bank ("FHLB") as collateral for borrowings and $2.0 billion at the Federal Reserve Bank ("FRB") for discount window borrowings.
[5]	Loans HIP of $257 million accounted for under ASC Subtopic 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.

December 31, 2018
Puerto Rico

			Past due											Past due 90 days or more
			30-59		60-89		90 days	Total						Non-accrual			Accruing
(In thousands)			days		days		or more	past due		Current		Loans HIP		loans		loans^[1]
Commercial multi-family		$	1,441	$	112	$	598	$	2,151	$	143,477	$	145,628	$	546	$	-
Commercial real estate:
	Non-owner occupied		92,075		839		45,691		138,605		2,183,996		2,322,601		39,257		-
	Owner occupied		6,681		10,839		99,235		116,755		1,605,498		1,722,253		88,069		-
Commercial and industrial			4,137		641		55,321		60,099		3,122,062		3,182,161		55,078		243
Construction			-		-		1,788		1,788		84,167		85,955		1,788		-
Mortgage			275,367		128,104		1,043,607		1,447,078		4,986,245		6,433,323		323,565		595,525
Leasing			7,663		1,827		3,313		12,803		921,970		934,773		3,313		-
Consumer:
	Credit cards		9,504		7,391		16,035		32,930		1,014,343		1,047,273		-		16,035
	Home equity lines of credit		-		97		165		262		5,089		5,351		11		154
	Personal		13,069		7,907		18,515		39,491		1,211,134		1,250,625		17,887		35
	Auto		52,204		9,862		24,177		86,243		2,522,542		2,608,785		24,050		127
	Other		566		288		14,958		15,812		128,932		144,744		14,534		424
Total		$	462,707	$	167,907	$	1,323,403	$	1,954,017	$	17,929,455	$	19,883,472	$	568,098	$	612,543
[1]	Non-covered loans HIP of $143 million accounted for under ASC Subtopic 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.

December 31, 2018
Popular U.S.

			Past due											Past due 90 days or more
			30-59		60-89		90 days		Total					Non-accrual			Accruing
(In thousands)			days		days		or more		past due		Current		Loans HIP	loans		loans^[1]
Commercial multi-family		$	3,163	$	-	$	-	$	3,163	$	1,398,377	$	1,401,540	$	-	$	-
Commercial real estate:
	Non-owner occupied		707		288		365		1,360		1,880,384		1,881,744		365		-
	Owner occupied		5,125		1,728		381		7,234		291,705		298,939		381		-
Commercial and industrial			2,354		995		73,726		77,075		1,011,078		1,088,153		330		-
Construction			-		-		12,060		12,060		681,434		693,494		12,060		-
Mortgage			13,615		3,197		11,033		27,845		774,090		801,935		11,033		-
Legacy			195		445		2,627		3,267		22,682		25,949		2,627		-
Consumer:
	Credit cards		2		-		-		2		36		38		-		-
	Home equity lines of credit		886		464		13,579		14,929		128,123		143,052		13,579		-
	Personal		2,319		1,723		2,610		6,652		282,697		289,349		2,610		-
	Other		-		-		4		4		220		224		4		-
Total		$	28,366	$	8,840	$	116,385	$	153,591	$	6,470,826	$	6,624,417	$	42,989	$	-
[1]	Non-covered loans HIP of $73 million accounted for under ASC Subtopic 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.

December 31, 2018
Popular, Inc.

			Past due											Past due 90 days or more
			30-59		60-89		90 days		Total					Non-accrual			Accruing
(In thousands)			days		days		or more		past due	Current		Loans HIP^{[3] [4]}		loans		loans^[5]
Commercial multi-family		$	4,604	$	112	$	598	$	5,314	$	1,541,854	$	1,547,168	$	546	$	-
Commercial real estate:
	Non-owner occupied		92,782		1,127		46,056		139,965		4,064,380		4,204,345		39,622		-
	Owner occupied		11,806		12,567		99,616		123,989		1,897,203		2,021,192		88,450		-
Commercial and industrial			6,491		1,636		129,047		137,174		4,133,140		4,270,314		55,408		243
Construction			-		-		13,848		13,848		765,601		779,449		13,848		-
Mortgage^[1]			288,982		131,301		1,054,640		1,474,923		5,760,335		7,235,258		334,598		595,525
Leasing			7,663		1,827		3,313		12,803		921,970		934,773		3,313		-
Legacy^[2]			195		445		2,627		3,267		22,682		25,949		2,627		-
Consumer:
	Credit cards		9,506		7,391		16,035		32,932		1,014,379		1,047,311		-		16,035
	Home equity lines of credit		886		561		13,744		15,191		133,212		148,403		13,590		154
	Personal		15,388		9,630		21,125		46,143		1,493,831		1,539,974		20,497		35
	Auto		52,204		9,862		24,177		86,243		2,522,542		2,608,785		24,050		127
	Other		566		288		14,962		15,816		129,152		144,968		14,538		424
Total		$	491,073	$	176,747	$	1,439,788	$	2,107,608	$	24,400,281	$	26,507,889	$	611,087	$	612,543

[1]	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.
[2]	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 Popular U.S. segment.
[3]	Loans held-in-portfolio are net of $156 million in unearned income and exclude $51 million in loans held-for-sale.
[4]	Includes $6.9 billion pledged to secure credit facilities and public funds that the secured parties are not permitted to sell or repledge the collateral, of which $4.8 billion were pledged at the FHLB as collateral for borrowings and $2.1 billion at the FRB for discount window borrowings.
[5]	Non-covered loans HIP of $216 million accounted for under ASC Subtopic 310-30 are excluded from the above table as they are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analysis.

At March 31, 2019, mortgage loans held-in-portfolio include $1.4 billion of loans insured by the Federal Housing Administration (“FHA”), or guaranteed by the U.S. Department of Veterans Affairs (“VA”) of which $535 million are 90 days or more past due, including $106 million of loans rebooked under the GNMA buyback option, discussed below (December 31, 2018 - $1.4 billion, $598 million and $134 million, respectively). Within this portfolio, loans in a delinquency status of 90 days or more are reported as accruing loans as opposed to non-performing since the principal repayment is insured. These balances include $292 million of residential mortgage loans in Puerto Rico that are no longer accruing interest as of March 31, 2019 (December 31, 2018 - $283 million). Additionally, the Corporation has approximately $67 million in reverse mortgage loans in Puerto Rico which are guaranteed by FHA, but which are currently not accruing interest at March 31, 2019 (December 31, 2018 - $69 million).

Loans with a delinquency status of 90 days past due as of March 31, 2019 include $106 million in loans previously pooled into GNMA securities (December 31, 2018 - $134 million). Under the GNMA program, issuers such as BPPR have the option but not the obligation to repurchase loans that are 90 days or more past due. For accounting purposes, these loans subject to the repurchase option are required to be reflected on the financial statements of BPPR with an offsetting liability.

Loans acquired with deteriorated credit quality accounted for under ASC 310-30

The following provides information of loans acquired with evidence of credit deterioration as of the acquisition date, accounted for under the guidance of ASC 310-30.

The outstanding principal balance of acquired loans accounted pursuant to ASC Subtopic 310-30, amounted to $2.1 billion at March 31, 2019 (December 31, 2018 - $2.2 billion). The carrying amount of these loans consisted of loans determined to be impaired at the time of acquisition, which are accounted for in accordance with ASC Subtopic 310-30 (“credit impaired loans”), and loans that were considered to be performing at the acquisition date, accounted for by analogy to ASC Subtopic 310-30 (“non-credit impaired loans”).

The following table provides the carrying amount of acquired loans accounted for under ASC 310-30 by portfolio at March 31, 2019 and December 31, 2018.

At March 31, 2019, none of the acquired loans accounted for under ASC Subtopic 310-30 were considered non-performing loans. Therefore, interest income, through accretion of the difference between the carrying amount of the loans and the expected cash flows, was recognized on all acquired loans.

Changes in the carrying amount and the accretable yield for the loans accounted pursuant to the ASC Subtopic 310-30, for the quarters ended March 31, 2019 and 2018, were as follows:

Carrying amount of acquired loans accounted for pursuant to ASC 310-30
		For the quarter ended
(In thousands)			March 31, 2019		March 31, 2018
Beginning balance		$	1,883,556	$	2,108,993
Additions			5,220		5,272
Accretion			37,404		42,060
Collections / loan sales / charge-offs			(94,923)		(71,134)
Ending balance^[1]		$	1,831,257	$	2,085,191
Allowance for loan losses			(124,147)		(146,120)
Ending balance, net of ALLL		$	1,707,110	$	1,939,071
[1]	At March 31, 2019, includes $1.3 billion of loans considered non-credit impaired at the acquisition date (March 31, 2018 - $1.5 billion).

Activity in the accretable yield of acquired loans accounted for pursuant to ASC 310-30
		For the quarter ended
(In thousands)			March 31, 2019		March 31, 2018
Beginning balance		$	1,092,504	$	1,214,488
Additions			2,890		3,437
Accretion			(37,404)		(42,060)
Change in expected cash flows			10,177		28,861
Ending balance^[1]		$	1,068,167	$	1,204,726
[1]	At March 31, 2019, includes $0.7 billion for loans considered non-credit impaired at the acquisition date (March 31, 2018 - $0.9 billion).