Income taxes (Tables)

3 Months Ended

Mar. 31, 2020

Components of Deferred Tax Assets and Liabilities

			March 31, 2020
(In thousands)			PR		US		Total
Deferred tax assets:
Tax credits available for carryforward		$	2,368	$	5,269	$	7,637
Net operating loss and other carryforward available			117,927		717,565		835,492
Postretirement and pension benefits			81,912		-		81,912
Deferred loan origination fees			2,043		(3,164)		(1,121)
Allowance for loan losses			465,054		38,957		504,011
Accelerated depreciation			3,439		4,908		8,347
FDIC-assisted transaction			82,936		-		82,936
Intercompany deferred gains			1,335		-		1,335
Lease liability			22,847		22,636		45,483
Difference in outside basis from pass-through entities			53,892		-		53,892
Other temporary differences			31,893		7,702		39,595
	Total gross deferred tax assets		865,646		793,873		1,659,519
Deferred tax liabilities:
Indefinite-lived intangibles			38,243		37,152		75,395
Unrealized net gain (loss) on trading and available-for-sale securities			81,077		7,306		88,383
Right of use assets			20,739		20,702		41,441
Other temporary differences			11,924		1,182		13,106
	Total gross deferred tax liabilities		151,983		66,342		218,325
Valuation allowance			105,165		408,079		513,244
Net deferred tax asset		$	608,498	$	319,452	$	927,950
			December 31, 2019
(In thousands)			PR		US		Total
Deferred tax assets:
Tax credits available for carryforward		$	2,368	$	5,269	$	7,637
Net operating loss and other carryforward available			112,803		716,796		829,599
Postretirement and pension benefits			82,623		-		82,623
Deferred loan origination fees			2,519		(2,759)		(240)
Allowance for loan losses			405,475		10,981		416,456
Accelerated depreciation			3,439		4,914		8,353
FDIC-assisted transaction			82,684		-		82,684
Intercompany deferred gains			1,604		-		1,604
Lease liability			22,694		23,387		46,081
Difference in outside basis from pass-through entities			21,670		-		21,670
Other temporary differences			26,554		7,460		34,014
	Total gross deferred tax assets		764,433		766,048		1,530,481
Deferred tax liabilities:
Indefinite-lived intangibles			37,411		36,058		73,469
Unrealized net gain (loss) on trading and available-for-sale securities			15,635		432		16,067
Right of use assets			20,598		21,430		42,028
Other temporary differences			12,778		1,179		13,957
	Total gross deferred tax liabilities		86,422		59,099		145,521
Valuation allowance			100,175		399,800		499,975
Net deferred tax asset		$	577,836	$	307,149	$	884,985

Reconciliation of Unrecognized Tax Benefits

(In millions)		2020		2019
Balance at January 1	$	16.3	$	7.2
Additions for tax positions -January through March		-		0.3
Balance at March 31	$	16.3	$	7.5

PUERTO RICO

Differences Between Income Tax Expense (Benefit) Applicable to Income Before Income Taxes and Amount Computed by Applying the Statutory Tax Rate in Puerto Rico

		Quarters ended
		March 31, 2020				March 31, 2019
(In thousands)		Amount	% of pre-tax income			Amount	% of pre-tax income
Computed income tax expense at statutory rates	$	14,025	38	%	$	81,806	38	%
Net benefit of tax exempt interest income		(32,896)	(88)			(26,944)	(12)
Deferred tax asset valuation allowance		5,538	15			5,482	2
Difference in tax rates due to multiple jurisdictions		8,875	24			(2,862)	(1)
Effect of income subject to preferential tax rate		(1,900)	(5)			(2,928)	(1)
Adjustment due to estimate on the annual effective rate		9,004	24			(3,130)	(2)
State and local taxes		(555)	(2)			1,624	-
Others		1,006	2			(2,825)	(1)
Income tax expense	$	3,097	8	%	$	50,223	23	%