Segment reporting

3 Months Ended

Mar. 31, 2023

Segment reporting disclosure

Segment Reporting

Note 33 – Segment reporting

The Corporation’s corporate structure consists of

two

 reportable segments –

Banco Popular de Puerto Rico and Popular U.S.

Management determined the reportable segments based on the internal reporting used to evaluate performance and to assess

where to allocate resources.

 The segments were determined based on the organizational structure, which focuses primarily on the

markets the segments serve, as well as on the products and services offered by the segments.

Banco Popular de Puerto Rico: 

The Banco Popular de Puerto Rico reportable segment includes commercial, consumer and retail banking operations conducted at

BPPR, including U.S. based activities conducted through its New York Branch. It also includes the lending operations of Popular

Auto and Popular Mortgage. Other financial services within the BPPR segment include the trust service units of BPPR, asset

management services of Popular Asset Management, the brokerage and investment banking operations of Popular Securities, and

the insurance agency and reinsurance businesses of Popular Insurance, Popular Risk Services, Popular Life Re, and Popular Re.

Popular U.S.: 

Popular U.S. reportable segment consists of the banking operations of Popular Bank (PB), Popular Insurance Agency, U.S.A., and

PEF. PB operates through a retail branch network in the U.S. mainland under the name of Popular, and equipment leasing and

financing services through PEF. Popular Insurance Agency, U.S.A. offers investment and insurance services across the PB branch

network. 

The Corporate group consists primarily of the holding companies Popular, Inc., Popular North America, Popular International Bank

and certain of the Corporation’s investments accounted for under the equity method, including Evertec, until August 15, 2022, and

Centro Financiero BHD, León. 

The accounting policies of the individual operating segments are the same as those of the Corporation. Transactions between

reportable segments are primarily conducted at market rates, resulting in profits that are eliminated for reporting consolidated results

of operations.

The tables that follow present the results of operations and total assets by reportable segments:

2023

For the quarter ended March 31, 2023

Banco Popular 

Intersegment 

(In thousands)

de Puerto Rico

Popular U.S.

Eliminations

Net interest income

$

449,820

$

90,086

$

1

Provision for credit losses

45,708

2,065

-

Non-interest income 

147,471

6,384

(136)

Amortization of intangibles

484

311

-

Depreciation expense

11,669

1,814

-

Other operating expenses

363,715

63,317

(136)

Income tax expense

42,832

3,976

-

Net income

$

132,883

$

24,987

$

1

Segment assets

$

55,770,442

$

12,147,556

$

(541,534)

For the quarter ended March 31, 2023

Reportable 

(In thousands)

Segments

Corporate

Eliminations

Total Popular, Inc.

Net interest income (expense)

$

539,907

$

(8,251)

$

-

$

531,656

Provision for credit losses (benefit)

47,773

(136)

-

47,637

Non-interest income

153,719

9,714

(1,472)

161,961

Amortization of intangibles

795

-

-

795

Depreciation expense

13,483

359

-

13,842

Other operating expenses

426,896

230

(1,076)

426,050

Income tax expense (benefit)

46,808

(321)

(173)

46,314

Net income

$

157,871

$

1,331

$

(223)

$

158,979

Segment assets

$

67,376,464

$

5,803,751

$

(5,504,456)

$

67,675,759

2022

For the quarter ended March 31, 2022

Banco Popular 

Intersegment 

(In thousands)

de Puerto Rico

 Popular U.S.

Eliminations

Net interest income

$

415,169

$

86,520

$

1

Provision for credit losses (benefit)

(13,690)

(2,019)

-

Non-interest income 

135,862

5,954

(137)

Amortization of intangibles

484

407

-

Depreciation expense

11,517

1,824

-

Other operating expenses

334,878

53,639

(136)

Income tax expense

39,316

11,592

-

Net income

$

178,526

$

27,031

$

-

Segment assets

$

58,708,519

$

10,579,410

$

(167,754)

For the quarter ended March 31, 2022

Reportable 

(In thousands)

Segments

Corporate

Eliminations

Total Popular, Inc.

Net interest income (expense)

$

501,690

$

(7,378)

$

-

$

494,312

Provision for credit losses (benefit)

(15,709)

209

-

(15,500)

Non-interest income

141,679

14,265

(1,252)

154,692

Amortization of intangibles

891

-

-

891

Depreciation expense

13,341

289

-

13,630

Other operating expenses

388,381

444

(1,007)

387,818

Income tax expense (benefit)

50,908

(332)

(97)

50,479

Net income

$

205,557

$

6,277

$

(148)

$

211,686

Segment assets

$

69,120,175

$

5,490,318

$

(5,085,411)

$

69,525,082

Geographic Information

The following information presents selected financial information based on the geographic location where the Corporation conducts

its business. The banking operations of BPPR are primarily based in Puerto Rico, where it has the largest retail banking franchise.

BPPR also conducts banking operations in the U.S. Virgin Islands, the British Virgin Islands and New York. BPPR’s banking

operations in the United States include co-branded credit cards offerings and commercial lending activities. BPPR’s commercial

lending activities in the U.S., through its New York Branch, include periodic loan participations with PB. As of March 31, 2023, BPPR

participated in loans originated by PB totaling $

316

 million (December 31, 2022 - $

294

 million). At March 31, 2023, total assets for

the BPPR segment related to its operations in the United States amounted to $

1.4

 billion (December 31, 2022 - $

1.2

 billion). During

the quarter ended March 31, 2023, the BPPR segment generated approximately $

25.4

 million (2022 - $

12.0

 million) in revenues

from its operations in the United States, including net interest income, service charges on deposit accounts and other service fees.

In the Virgin Islands, the BPPR segment offers banking products, including loans and deposits. The BPPR segment generated

$

11.6

 million in revenues during the first quarter of 2023 (2022 - $

10.8

 million) from its operations in the U.S. and British Virgin

Islands.

Geographic Information 

Quarter ended

(In thousands)

March 31, 2023

March 31, 2022

Revenues:

[1]

 Puerto Rico 

$

547,903

$

527,673

 United States

125,045

103,174

 Other

20,669

18,157

Total consolidated revenues 

$

693,617

$

649,004

[1]

Total revenues include net interest income, service charges on deposit accounts, other service fees, mortgage banking activities, net gain

(loss), including impairment on equity securities, net gain (loss) on trading account debt securities, adjustments to indemnity reserves on loans

sold and other operating income.

Selected Balance Sheet Information:

(In thousands)

March 31, 2023

December 31, 2022

Puerto Rico

Total assets

$

52,973,724

$

53,541,427

Loans

20,970,708

20,884,442

Deposits

50,589,328

51,138,790

United States

Total assets

$

13,506,272

$

12,718,775

Loans

10,825,221

10,643,964

Deposits

8,630,394

8,182,702

Other

Total assets

$

1,195,763

$

1,377,715

Loans

553,625

554,744

Deposits

[1]

1,734,166

1,905,735

[1]

Represents deposits from BPPR operations located in the U.S. and British Virgin Islands.