Stockholders' equity

12 Months Ended

Dec. 31, 2022

Stockholders' Equity Note

Stockholders' Equity

Note 20 – Stockholders’ equity

The Corporation’s common stock ranks junior to all series of preferred stock as to dividend rights and / or as to rights on liquidation,

dissolution or winding up of the Corporation. Dividends on preferred stock are payable if declared. The Corporation’s ability to

declare or pay dividends on, or purchase, redeem or otherwise acquire, its common stock is subject to certain restrictions in the

event that the Corporation fails to pay or set aside full dividends on the preferred stock for the latest dividend period. The ability of

the Corporation to pay dividends in the future is limited by regulatory requirements, legal availability of funds, recent and projected

financial results, capital levels and liquidity of the Corporation, general business conditions and other factors deemed relevant by the

Corporation’s Board of Directors.

The Corporation’s common stock trades on the Nasdaq Global Select Market (the “Nasdaq”) under the symbol BPOP. The 2003

Series A Preferred Stock are not listed on Nasdaq. 

Preferred stocks

The Corporation has

30,000,000

 shares of authorized preferred stock that may be issued in one or more series, and the shares of

each series shall have such rights and preferences as shall be fixed by the Board of Directors when authorizing the issuance of that

particular series. The Corporation’s shares of preferred stock at December 31, 2022 consisted of:

●

6.375

% non-cumulative monthly income preferred stock, 2003 Series A, no par value, liquidation preference value of $

25

per share. Holders on record of the 2003 Series A Preferred Stock are entitled to receive, when, as and if declared by the

Board of Directors of the Corporation or an authorized committee thereof, out of funds legally available, non-cumulative

cash dividends at the annual rate per share of

6.375

% of their liquidation preference value, or $

0.1328125

 per share per

month. These shares of preferred stock are perpetual, nonconvertible, have no preferential rights to purchase any

securities of the Corporation and are redeemable solely at the option of the Corporation with the consent of the Board of

Governors of the Federal Reserve System. The redemption price per share is $

25.00

. The shares of 2003 Series A

Preferred Stock have no voting rights, except for certain rights in instances when the Corporation does not pay dividends

for a defined period. These shares are not subject to any sinking fund requirement. Cash dividends declared and paid on

the 2003 Series A Preferred Stock amounted to $

1.4

 million for the years ended December 31, 2022, 2021 and 2020.

Outstanding shares of 2003 Series A Preferred Stock amounted to

885,726

 at December 31, 2022, 2021 and 2020.

On February 24, 2020, the Corporation redeemed all the outstanding shares of the 2008 Series B Preferred Stock. The redemption

price of the 2008 Series B Preferred Stock was $

25.00

 per share, plus $

0.1375

 (representing the amount of accrued and unpaid

dividends for the current monthly dividend period to the redemption date), for a total payment per share in the amount of $

25.1375

.

Common stock

Dividends

During the year 2022, cash dividends of $

2.20

 (2021 - $

1.75

; 2020 - $

1.60

) per common share outstanding were declared

amounting to $

163.7

 million (2021 - $

142.3

 million; 2020 - $

136.6

 million) of which $

39.5

 million were payable to stockholders of

common stock at December 31, 2022 (2021 - $

35.9

 million; 2020 - $

33.7

 million). The quarterly dividend of $

0.55

 per share

declared to stockholders of record as of the close of business on

December 7, 2022

, was paid on

January 3, 2023

. On February 28,

2023, the Corporation’s Board of Directors approved a quarterly cash dividend of $

0.55

 per share on its outstanding common stock,

payable on

April 3, 2023

 to stockholders of record at the close of business on

March 20, 2023

.

Accelerated share repurchase transaction (“ASR”)

On August 24, 2022, the Corporation entered into a $

231

 million ASR transaction with respect to its common stock (the “August

ASR Agreement”), which was accounted for as a treasury transaction. As a result of the receipt of the initial 

2,339,241

 shares, the

Corporation recognized in stockholders’ equity approximately $

185

 million in treasury stock and $

46

 million as a reduction of capital

surplus. The Corporation completed the transaction on December 7, 2022 and received

840,024

 additional shares of common stock

and recognized approximately $

60

 million as treasury stock with a corresponding increase in its capital surplus. In total the

Corporation repurchase a total of

3,179,265

 shares at an average purchased price of $

72.6583

 under the August ASR Agreement.

On March 1, 2022, the Corporation announced that on February 28, 2022 it entered into a $

400

 million ASR transactions with

respect to its common stock (the “March ASR Agreement”), which was accounted for as a treasury transaction. As a result of the

receipt of the initial

3,483,942

 shares, the Corporation recognized in stockholders’ equity approximately $

320

 million in treasury

stock and $

80

 million as a reduction of capital surplus. The Corporation completed the transaction on July 12, 2022 and received

1,582,922

 additional shares of common stock and recognized $

120

 million in treasury stock with a corresponding increase in its

capital surplus. In total the Corporation repurchased a total of

5,066,864

 shares at an average purchased price of $

78.9443

 under

the March ASR Agreement.

On May 3, 2021, the Corporation entered into a $

350

 million ASR transaction with respect to its common stock, which was

accounted for as a treasury stock transaction. As a result of the receipt of the initial

3,785,831

 shares, the Corporation recognized in

stockholders’ equity approximately $

280

 million in treasury stock and $

70

 million as a reduction in capital surplus. The Corporation

completed the transaction on September 9, 2021 and received

828,965

 additional shares of common stock and recognized $

61

million in treasury stock with a corresponding increase in capital surplus. In total, the Corporation repurchased a total of

4,614,796

shares at an average price of $

75.8430

 under the ASR Agreement.

On January 30, 2020, the Corporation entered into a $

500

 million ASR transaction with respect to its common stock, which was

accounted for as a treasury stock transaction. As a result of the receipt of the initial

7,055,919

 shares, the Corporation recognized in

stockholders’ equity approximately $

400

 million in treasury stock and $

100

 million as a reduction in capital surplus. On March 19,

2020 (the “early termination date”), the dealer counterparty to the ASR exercised its right to terminate the ASR as a result of the

trading price of the Corporation’s common stock falling below a specified level due to the effects of the COVID-19 pandemic on the

global markets. As a result of such early termination, the final settlement of the ASR, which was expected to occur during the fourth

quarter of 2020, occurred during the second quarter of 2020. The Corporation completed the transaction on May 27, 2020 and

received

4,763,216

 additional shares of common stock after the early termination date. In total the Corporation repurchased

11,819,135

 shares at an average price per share of $

42.3043

 under the ASR.

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 amounted to $

863

 million at December 31, 2022 (2021 - $

786

 million; 2020 - $

708

 million). During 2022, $

77

 million

was transferred to the statutory reserve account (2021 - $

78

 million, 2020 - $

49

 million). BPPR was in compliance with the statutory

reserve requirement in 2022, 2021 and 2020.