Exhibit 99
OFG Bancorp Reports 4Q16 & 2016 Results
SAN JUAN, Puerto Rico, January 31, 2017 – OFG Bancorp (NYSE: OFG) today reported results for the fourth quarter and year ended December 31, 2016.
4Q16 Highlights
• Net income available to shareholders increased to $12.1 million, or $0.27 per share fully diluted, from $11.7 million, or $0.26 per share fully diluted, in 3Q16 and a loss of $4.4 million, or ($0.10) per share, in the year ago 4Q15.
• Compared to 3Q16, results included increases of 13.8% in net interest income after provision and 11.7% in banking and wealth management revenues, while non-interest expenses fell 4.6%.
• The Oriental Bank franchise continued to deliver strong performance with loan production of $258.0 million, the highest quarterly level during 2016; a 3.9% year over year increase in customer deposits; and a 5% annual account growth.
• Credit quality remained strong as the non-performing loan rate at 3.46% fell to its lowest level in five quarters, and early and total delinquency rates declined from 3Q16 and 4Q15 to 3.31% and 6.49%, respectively.
• Major performance ratios improved from both 3Q16 and 4Q15, including return on average assets of 0.96%, return on average tangible common equity of 7.31%, efficiency ratio of 55.36%, and tangible common equity ratio of 10.33%.
2016 Highlights
• Net income available to shareholders was $45.3 million, or $1.03 per share fully diluted, compared to a loss of $16.4 million, or ($0.37) per share, in 2015.
• 2016 results reflected:
o 8.4% increase in interest income from originated loans to $199.2 million as average balances expanded to $3.1 billion or a 5.4% increase, due to growth in higher yielding retail loans.
o 17.4% decrease in total interest expense to $57.2 million on a 32.0% decline in average borrowings.
o Sale of Oriental Bank’s last major Puerto Rico government related loan, a participation in a Puerto Rico Electric Power Authority (PREPA) line of credit, eliminating $183.0 million of non-performing assets and requiring an additional provision of only $2.9 million.
o A $5.0 million recovery in a Bear Stearns claim from losses suffered from an investment in a private label collateralized mortgage obligation.
• Capital continued to grow as tangible book value per common share expanded 3.8% to $15.08 and book value per common share grew 3.1% to $17.18.
CEO Comment
José Rafael Fernández, President, Chief Executive Officer, and Vice Chairman of the Board, commented:
“OFG Bancorp generated another quarter of consistent, stellar performance in the fourth quarter and throughout 2016 despite the challenging operating environment.
“Fully diluted EPS grew to $0.27 in 4Q16 and to $1.03 for the year, a notable turnaround from prior periods. We accomplished this by growing interest income from originated loans and non-interest income, while reducing both interest and non-interest expenses.
“Thanks to our management team and associates, our uncompromising customer focus, excellence in service, and our broad and growing utilization of customer facing technology, we are clearly differentiating Oriental in the Puerto Rico marketplace.
“We have attracted a steady influx of new business, enabling us to expand or maintain our market share in key areas.
“In 2016, we introduced the Oriental Biz mobile app, adding mobile check capture for small business customers, and cardless cash, for making retail ATM withdrawals even faster.
“Our proactive credit monitoring systems have significantly improved asset quality, reducing the early and total delinquency rates, allowance for loan and lease losses, and the non-performing loan rate.
“We ended the year growing our tangible book value per common share to $15.08, underscoring our determination to enhance our already solid capital position.
“We have established Oriental as a uniquely service oriented banking institution. We are committed to continuing to consolidate our strategic position in Puerto Rico and further grow our customer base in a consistent and profitable way.”
4Q16 Income Statement Highlights
The following compares data for the fourth quarter 2016 to the third quarter 2016, unless otherwise noted.
• Interest Income:
o Originated Loans: Increased $1.0 million to $51.6 million, primarily due to higher yields from a larger proportion of retail loans.
o Acquired Loans: Declined $5.1 million to $26.9 million due to continued pay downs and lower cost recoveries. 3Q16 included $2.2 million in former Eurobank loan recoveries.
o Securities: Increased $0.3 million to $8.3 million due to lower premium amortization and higher investment portfolio balances.
• Interest Expense declined $1.1 million to $12.6 million due to lower borrowings. In 3Q16, $200.5 million in FHLB advances and $67.0 million in subordinated capital notes were paid down.
• Total Provision for Loan and Lease Losses declined $10.1 million to $13.4 million. In 3Q16, there was an additional $10.2 million provision for two Puerto Rico government related loans and one commercial loan.
• Net Interest Margin (NIM) remained essentially level at 4.94%. NIM, excluding recoveries, expanded to 4.89% compared to 4.70%.
• Total Banking and Wealth Management Revenues increased $2.1 million to $20.4 million. Wealth management rose $1.2 million, reflecting recognition of annual insurance revenues. Banking services grew $0.7 million due to holiday shopping related electronic transaction volume. Mortgage banking gained $0.3 million as a result of higher mortgage servicing rights (MSR) valuation.
• FDIC Shared-Loss Expense, Net decreased $0.5 million to $2.8 million, reflecting levels from prior quarters in 2016.
• Total Non-Interest Expenses declined $2.5 million to $52.4 million as most major cost areas were reduced. Credit expenses fell $1.6 million as 4Q16 is an off-quarter for property tax payments.
• Effective Tax Rate (ETR) increased to 41.1% due to final year-end tax accounting. For the year, the ETR was 30.5%.
December 31, 2016 Balance Sheet Highlights
The following compares data at December 31, 2016 to September 30, 2016, unless otherwise noted.
• Total Loans Net declined $151.3 million to $4.15 billion. This primarily reflected the exclusion of the PREPA loan, the sale of which settled in October 2016.
• Total Investments increased $64.8 million to $1.36 billion. This reflected new purchases of treasury securities and the retention of a portion of residential mortgage production as securities, partially offset by prepayments in the Mortgage Backed Securities portfolio.
• Customer Deposits declined $85.5 million to $4.09 billion due to cyclic fluctuations in our large commercial account balances. On a year over year basis, customer deposits increased $153.3 million primarily reflecting growth of our client base.
• Total Borrowings declined $4.9 million to $795.4 million due to slightly lower balances in repurchase agreement funding. On a year over year basis, borrowings declined $576.2 million with large reductions in all categories.
• Total Stockholders’ Equity declined $4.5 million to $920.4 million. On a year over year basis, stockholders’ equity increased $23.3 million. Retained earnings grew $28.9 million, or 19.4%, to $177.8 million, which was partially offset by a 4Q16 decline in the market value of investment securities.
Credit Quality Highlights
The following compares data at December 31, 2016 to September 30, 2016, unless otherwise noted.
• Net Charge-Off Rate was 1.80% compared to 1.15% (ex-PREPA) due to increases in the mortgage and commercial lending categories. Total charge offs for 4Q16 included a $3.0 million loan that was provisioned for in 3Q16.
• Early and Total Delinquency rates improved to 3.31% and 6.49%, compared to 3.70% and 6.92%, respectively.
• Non-Performing Loan Rate was lower at 3.46% compared to 3.68%. It was 9.74% a year ago, which included the PREPA loan.
• Allowance for Loan and Lease Losses fell to $59.3 million from $62.2 million, and the loan loss reserve ratio to total loans (excluding acquired loans) decreased to 1.95% from 2.06%.
Capital Position
The following compares data at December 31, 2016 to September 30, 2016, unless otherwise noted.
Regulatory capital ratios continued to be significantly above requirements for a well-capitalized institution.
• Tangible Common Equity to Total Tangible Assets at 10.33% increased 8 basis points to the highest level in five quarters.
• Tangible Book Value per Common Share at $15.08 increased 3.8% year over year.
• Common Equity Tier 1 Capital Ratio (using Basel III methodology) at 14.05% increased 71 basis points to the highest level in five quarters.
• Total Risk-Based Capital Ratio at 19.62% increased 89 basis points to the highest level in five quarters.
Conference Call
A conference call to discuss OFG’s results for the fourth quarter 2016, outlook and related matters will be held today, Tuesday, January 31, 2017 at 10:00 AM Eastern Time. The call will be accessible live via a webcast on OFG’s Investor Relations website at www.ofgbancorp.com. A webcast replay will be available shortly thereafter. Access the webcast link in advance to download any necessary software.
Financial Supplement
OFG’s Financial Supplement, with full financial tables for the fourth quarter and year ended December 31, 2016, can be found on the Webcasts, Presentations & Other Files page, on OFG’s Investor Relations website at www.ofgbancorp.com.
Non-GAAP Financial Measures
In addition to our financial information presented in accordance with GAAP, management uses certain “non-GAAP financial measures” within the meaning of the SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. See Tables 9-1 and 9-2 in OFG’s above-mentioned Financial Supplement for reconciliation of GAAP to non-GAAP Measures and Calculations.
Forward Looking Statements
The information included in this document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements.
Factors that might cause such a difference include, but are not limited to (i) the rate of growth in the economy and employment levels, as well as general business and economic
conditions; (ii) changes in interest rates, as well as the magnitude of such changes; (iii) a credit default by the government of Puerto Rico; (iv) the fiscal and monetary policies of the federal government and its agencies; (v) changes in federal bank regulatory and supervisory policies, including required levels of capital; (vi) the relative strength or weakness of the consumer and commercial credit sectors and of the real estate market in Puerto Rico; (vii) the performance of the stock and bond markets; (viii) competition in the financial services industry; and (ix) possible legislative, tax or regulatory changes.
For a discussion of such factors and certain risks and uncertainties to which OFG is subject, see OFG’s annual report on Form 10-K for the year ended December 31, 2015, as well as its other filings with the U.S. Securities and Exchange Commission. Other than to the extent required by applicable law, including the requirements of applicable securities laws, OFG assumes no obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
About OFG Bancorp
Now in its 53rd year in business, OFG Bancorp is a diversified financial holding company that operates under U.S. and Puerto Rico banking laws and regulations. Its three principal subsidiaries, Oriental Bank, Oriental Financial Services and Oriental Insurance, provide a full range of commercial, consumer and mortgage banking services, as well as financial planning, trust, insurance, investment brokerage and investment banking services, primarily in Puerto Rico, through 48 financial centers. Investor information can be found at www.ofgbancorp.com.
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Contacts
Puerto Rico: Idalis Montalvo (idalis.montalvo@orientalbank.com) at (787) 777-2847
US: Steven Anreder (sanreder@ofgbancorp.com) and Gary Fishman (gfishman@ofgbancorp.com) at (212) 532-3232
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OFG Bancorp | |
Financial Supplement | |
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The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation, and investors should refer to our December 31, 2016 Annual Report on Form 10-K once it is filed with the Securities and Exchange Commission. | |
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Table of Contents | |
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| OFG Bancorp (Consolidated Financial Information) | | | |
| Table 1: | | Financial and Statistical Summary - Consolidated | | 2 | |
| Table 2: | | Consolidated Statements of Operations | | 3 | |
| Table 3: | | Consolidated Statements of Financial Condition | | 4 | |
| Table 4: | | Information on Loan Portfolio and Production | | 5 | |
| Table 5: | | Average Balances, Net Interest Income and Net Interest Margin | | 6-7 | |
| Table 6: | | Loan Information and Performance Statistics (Excluding Acquired Loans) | | 8-9 | |
| Table 7: | | Allowance for Loan and Lease Losses | | 10 | |
| Table 8: | | Accretable Yield on Loans Accounted for Under ASC 310-30 (Loans Acquired | | | |
| | | with Deteriorated Credit Quality, Including those by Analogy) | | 11 | |
| Table 9: | | Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory | | | |
| | | Capital | | 12-13 | |
| Table 10: | | Notes to Financial Summary, Selected Metrics, Loans, and Consolidated | | | |
| | | Financial Statements (Tables 1-9) | | 14 | |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | | | | | | | | |
Table 1: Financial and Statistical Summary - Consolidated | | |
| | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | | 2016 | | 2015 | | |
(Dollars in thousands, except per share data) (unaudited) | | | Q4 | | Q3 | | Q2 | | Q1 | | Q4 | | YTD | | YTD | | |
Earnings | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest income | | | $ | 74,213 | | $ | 76,927 | | $ | 73,312 | | $ | 74,975 | | $ | 75,622 | | $ | 299,427 | | $ | 337,372 | | |
Non-interest income, net (core) | (2) | | | 20,415 | | | 18,277 | | | 18,284 | | | 17,125 | | | 19,349 | | | 74,101 | | | 76,634 | | |
Non-interest expense | | | | 52,382 | | | 54,926 | | | 53,825 | | | 54,857 | | | 58,542 | | | 215,990 | | | 248,401 | | |
Pre-provision net revenues | | | | 42,246 | | | 40,278 | | | 37,771 | | | 37,243 | | | 36,429 | | | 157,538 | | | 165,605 | | |
Provision for loan and lease losses | | | | 13,373 | | | 23,469 | (e) | | 14,445 | | | 13,789 | | | 52,190 | (a) | | 65,076 | | | 161,501 | (a)(b) | |
FDIC shared-loss expense, net | | | | 2,836 | | | 3,296 | | | 3,420 | | | 4,029 | | | 4,400 | | | 13,581 | | | 42,808 | (c) | |
Net income (loss) before income taxes | | | | 26,404 | | | 18,747 | | | 20,197 | | | 19,832 | | | (20,840) | | | 85,180 | | | (20,058) | | |
Income tax expense (benefit) | | | | 10,848 | | | 3,627 | | | 5,858 | | | 5,661 | | | (19,864) | | | 25,994 | | | (17,554) | | |
Net income (loss) | | | $ | 15,556 | | $ | 15,120 | | $ | 14,339 | | $ | 14,171 | | $ | (976) | | $ | 59,186 | | $ | (2,504) | | |
Common Share Statistics | | | | | | | | | | | | | | | | | | | | | | | | |
Earnings (loss) per common share - basic | (3) | | $ | 0.28 | | $ | 0.27 | | $ | 0.25 | | $ | 0.24 | | $ | (0.10) | | $ | 1.03 | | $ | (0.37) | | |
Earnings (loss) per common share - diluted | (4) | | $ | 0.27 | | $ | 0.26 | | $ | 0.25 | | $ | 0.24 | | $ | (0.10) | | $ | 1.03 | | $ | (0.37) | | |
Average common shares outstanding | | | | 43,914 | | | 43,926 | | | 43,914 | | | 43,898 | | | 43,868 | | | 43,913 | | | 44,231 | | |
Average common shares outstanding and equivalents | | | | 51,098 | | | 51,111 | | | 51,095 | | | 51,064 | | | 51,069 | | | 51,088 | | | 51,455 | | |
Cash dividends per common share | | | $ | 0.06 | | $ | 0.06 | | $ | 0.06 | | $ | 0.06 | | $ | 0.06 | | $ | 0.24 | | $ | 0.36 | (d) | |
Book value per common share (period end) | | | $ | 17.18 | | $ | 17.29 | | $ | 17.08 | | $ | 16.80 | | $ | 16.67 | | $ | 17.18 | | $ | 16.67 | | |
Tangible book value per common share (period end) | (5) | | $ | 15.08 | | $ | 15.18 | | $ | 14.96 | | $ | 14.68 | | $ | 14.53 | | $ | 15.08 | | $ | 14.53 | | |
Balance Sheet (Average Balances) | | | | | | | | | | | | | | | | | | | | | | | | |
Loans | (6) | | $ | 4,195,966 | | $ | 4,398,032 | | $ | 4,445,658 | | $ | 4,484,410 | | $ | 4,552,234 | | $ | 4,383,487 | | $ | 4,704,278 | | |
Interest-earning assets | | | | 5,972,163 | | | 6,169,251 | | | 6,270,042 | | | 6,437,255 | | | 6,600,614 | | | 6,214,334 | | | 6,704,996 | | |
Total assets | | | | 6,454,982 | | | 6,653,414 | | | 6,778,211 | | | 6,990,212 | | | 7,160,328 | | | 6,718,291 | | | 7,344,330 | | |
Interest-bearing deposits | | | | 3,875,536 | | | 3,920,565 | | | 3,929,280 | | | 3,956,790 | | | 3,931,009 | | | 3,934,125 | | | 4,003,456 | | |
Borrowings | | | | 750,446 | | | 917,212 | | | 1,047,753 | | | 1,239,672 | | | 1,394,171 | | | 987,925 | | | 1,453,126 | | |
Stockholders' equity | | | | 919,697 | | | 919,171 | | | 908,394 | | | 899,858 | | | 905,646 | | | 911,832 | | | 923,980 | | |
Common stockholders' equity | | | | 753,827 | | | 753,301 | | | 742,524 | | | 733,988 | | | 739,776 | | | 745,962 | | | 758,110 | | |
Performance Metrics | | | | | | | | | | | | | | | | | | | | | | | | |
Net interest margin | (7) | | | 4.94% | | | 4.95% | | | 4.69% | | | 4.67% | | | 4.55% | | | 4.82% | | | 5.03% | | |
Return on average assets | (8) | | | 0.96% | | | 0.91% | | | 0.85% | | | 0.81% | | | -0.05% | | | 0.88% | | | -0.03% | | |
Return on average tangible common stockholders' equity | (9) | | | 7.31% | | | 7.06% | | | 6.70% | | | 6.69% | | | -2.75% | | | 6.94% | | | -2.47% | | |
Efficiency ratio | (10) | | | 55.36% | | | 57.69% | | | 58.76% | | | 59.56% | | | 61.64% | | | 57.82% | | | 60.00% | | |
Full-time equivalent employees, period end | | | | 1,416 | | | 1,439 | | | 1,451 | | | 1,467 | | | 1,466 | | | 1,416 | | | 1,466 | | |
Credit Quality Metrics | | | | | | | | | | | | | | | | | | | | | | | | |
Excluding acquired loans: | (1) | | | | | | | | | | | | | | | | | | | | | | | |
Allowance for loan and lease losses | | | $ | 59,300 | | $ | 62,168 | (e) | $ | 112,812 | | $ | 113,238 | | $ | 112,626 | (a) | $ | 59,300 | | $ | 112,626 | | |
Allowance as a % of loans held for investment | | | | 1.95% | | | 2.06% | | | 3.53% | | | 3.63% | | | 3.62% | | | 1.95% | | | 3.62% | | |
Net charge-offs | | | $ | 13,506 | | $ | 65,352 | (e) | $ | 9,478 | | $ | 10,048 | | $ | 12,737 | | $ | 88,336 | | $ | 38,149 | | |
Net charge-off rate | (11) | | | 1.80% | | | 8.27% | (e) | | 1.21% | | | 1.30% | | | 1.67% | | | 2.85% | | | 1.30% | | |
Early delinquency rate (30 - 89 days past due) | | | | 3.31% | | | 3.70% | | | 3.31% | | | 3.51% | | | 3.70% | | | 3.31% | | | 3.70% | | |
Total delinquency rate (30 days and over) | | | | 6.49% | | | 6.92% | | | 6.28% | | | 6.72% | | | 6.94% | | | 6.49% | | | 6.94% | | |
Capital Ratios (Non-GAAP) | (12) | | | | | | | | | | | | | | | | | | | | | | | |
Leverage ratio | | | | 12.99% | | | 12.35% | | | 11.92% | | | 11.38% | | | 11.18% | | | 12.99% | | | 11.18% | | |
Common equity Tier 1 capital ratio | | | | 14.05% | | | 13.34% | | | 12.64% | | | 12.33% | | | 12.14% | | | 14.05% | | | 12.14% | | |
Tier 1 risk-based capital ratio | | | | 18.35% | | | 17.46% | | | 16.71% | | | 16.36% | | | 15.99% | | | 18.35% | | | 15.99% | | |
Total risk-based capital ratio | | | | 19.62% | | | 18.73% | | | 18.00% | | | 17.67% | | | 17.29% | | | 19.62% | | | 17.29% | | |
Tangible common equity ("TCE") ratio | | | | 10.33% | | | 10.25% | | | 9.92% | | | 9.50% | | | 9.10% | | | 10.33% | | | 9.10% | | |
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(a) During Q1 2015, the Company placed its $200 million participation in a fuel purchase line of credit with the Puerto Rico Electric Power Authority (PREPA) on non-accrual status and recorded a $24.0 million provision for loan and lease losses. During Q4 2015, the Company recorded an additional $29.3 million provision for loan and lease losses related to PREPA. Both were part of the overall quarterly provision for loan and lease losses. | |
(b) During Q3 2015, the Company sold a portion of covered non-performing commercial loans amounting to $197.1 million unpaid principal balance or UPB ($100.0 million carrying amount). The sales price was 18.44% of UPB, or $36.3 million. The FDIC agreed to cover $20.0 million of losses as part of its loss-share agreement with the Company. As a result, a $20.0 million reimbursement was recorded in the statement of operations. The Company also recorded a $32.9 million provision for loan and lease losses for acquired Eurobank loans, which was partially offset by $4.6 million in cost recoveries. Also, as part of this transaction, the Company sold certain non-performing commercial loans and real estate owned from the BBVAPR acquisition amounting to $38.1 million UPB ($9.9 million carrying amount). The sales price was $5.2 million. As a result, a $5.2 million provision for loan and lease losses was recorded for BBVAPR acquired loans, which was partially offset by $2.4 million in cost recoveries. In addition, certain real estate owned with a carrying amount of $11.0 million was sold for $1.7 million. At September 30 , 2015, the Company had a $13.0 million receivable related to this sale and a $20.0 million receivable from the FDIC for the shared-loss portion, both balances were received in December 2015. | |
(c) The FDIC loss share coverage for the commercial loans and other non-single family loans was in effect until June 30, 2015. The FDIC granted an extension of 120 days for the sale of part of this portfolio and agreed to cover up to $20 million with respect to the aggregate loss resulting from this sale. | |
(d) The Board of directors decreased OFG's regular quarterly dividend per common share to $0.06 per share during Q4 2015 from $0.10 per share. | |
(e) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 million provision for loan and lease losses during the quarter ended September 30, 2016. | |
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OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | | | | | | | | |
Table 2: Consolidated Statements of Operations | | | | | | | | | |
| | Quarter Ended | | Year Ended | | |
| | | December 31, | | September 30, | | June 30, | | March 31, | | December 31, | | December 31, | | December 31, | | |
(Dollars in thousands, except per share data) (unaudited) | | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | | 2016 | | 2015 | | |
Interest income: | | | | | | | | | | | | | | | | | | | | | | | | |
Loans | (1) | | | | | | | | | | | | | | | | | | | | | | | |
Non-acquired loans | | | $ | 51,581 | | $ | 50,568 | | $ | 49,108 | | $ | 47,915 | | $ | 47,261 | | $ | 199,172 | | $ | 183,820 | | |
Acquired BBVAPR loans | | | | 20,232 | | | 22,723 | | | 23,670 | | | 25,676 | | | 26,976 | | | 92,301 | | | 131,392 | | |
Acquired Eurobank loans | | | | 6,701 | | | 9,313 | | | 6,897 | | | 7,561 | | | 8,134 | | | 30,472 | | | 52,410 | | |
Total interest income from loans | | | | 78,514 | | | 82,604 | | | 79,675 | | | 81,152 | | | 82,371 | | | 321,945 | | | 367,622 | | |
Investment securities | | | | 8,280 | | | 7,980 | | | 8,233 | | | 10,154 | | | 10,536 | | | 34,647 | | | 38,946 | | |
Total interest income | | | | 86,794 | | | 90,584 | | | 87,908 | | | 91,306 | | | 92,907 | | | 356,592 | | | 406,568 | | |
Interest expense: | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | | | | | | | | | | | | | | | | | | | | | | | |
Core deposits | | | | 5,536 | | | 5,580 | | | 5,551 | | | 5,136 | | | 5,237 | | | 21,803 | | | 22,134 | | |
Brokered deposits | | | | 1,895 | | | 1,751 | | | 1,816 | | | 1,988 | | | 1,438 | | | 7,450 | | | 4,900 | | |
Total deposits | | | | 7,431 | | | 7,331 | | | 7,367 | | | 7,124 | | | 6,675 | | | 29,253 | | | 27,034 | | |
Borrowings | | | | 5,150 | | | 6,326 | | | 7,229 | | | 9,207 | | | 10,610 | | | 27,912 | | | 42,162 | | |
Total interest expense | | | | 12,581 | | | 13,657 | | | 14,596 | | | 16,331 | | | 17,285 | | | 57,165 | | | 69,196 | | |
Net interest income | | | | 74,213 | | | 76,927 | | | 73,312 | | | 74,975 | | | 75,622 | | | 299,427 | | | 337,372 | | |
Provision for loan and lease losses, excluding acquired loans | (1) | | | 10,638 | | | 14,708 | (f) | | 9,052 | | | 10,660 | | | 45,012 | (a) | | 45,058 | | | 99,336 | (a) | |
Provision for acquired BBVAPR loan and lease losses | (1) | | | 3,135 | | | 7,942 | | | 4,362 | | | 2,324 | | | 7,332 | | | 17,763 | | | 24,125 | | |
Provision (recapture) for acquired Eurobank loan and lease losses | (1) | | | (400) | | | 819 | | | 1,031 | | | 805 | | | (154) | | | 2,255 | | | 38,040 | (b) | |
Total provision for loan and lease losses, net | | | | 13,373 | | | 23,469 | | | 14,445 | | | 13,789 | | | 52,190 | | | 65,076 | | | 161,501 | | |
Net interest income after provision for loan and lease losses | | | | 60,840 | | | 53,458 | | | 58,867 | | | 61,186 | | | 23,432 | | | 234,351 | | | 175,871 | | |
Non-interest income: | | | | | | | | | | | | | | | | | | | | | | | | |
Banking service revenues | | | | 10,980 | | | 10,330 | | | 10,219 | | | 10,118 | | | 10,223 | | | 41,647 | | | 41,466 | | |
Wealth management revenues | | | | 7,714 | | | 6,526 | | | 7,041 | | | 6,152 | | | 7,715 | | | 27,433 | | | 29,040 | | |
Mortgage banking activities | | | | 1,721 | | | 1,421 | | | 1,024 | | | 855 | | | 1,411 | | | 5,021 | | | 6,128 | | |
Total banking and wealth management revenues | | | | 20,415 | | | 18,277 | | | 18,284 | | | 17,125 | | | 19,349 | | | 74,101 | | | 76,634 | | |
FDIC shared-loss expense, net | | | | (2,836) | | | (3,296) | | | (3,420) | | | (4,029) | | | (4,400) | | | (13,581) | | | (42,808) | (c) | |
Other-than-temporary impairment losses on investment securities | | | | - | | | - | | | - | | | - | | | (1,244) | | | - | | | (1,490) | | |
Reimbursement from FDIC shared-loss coverage in sale of loans | | | | - | | | - | | | - | | | - | | | - | | | - | | | 20,000 | (b) | |
Other gains (losses), net | | | | 367 | | | 5,234 | (g) | | 291 | | | 407 | (d) | | 565 | | | 6,299 | (d) | | 136 | | |
Total non-interest income (loss), net | | | | 17,946 | | | 20,215 | | | 15,155 | | | 13,503 | | | 14,270 | | | 66,819 | | | 52,472 | | |
Non-interest expense: | | | | | | | | | | | | | | | | | | | | | | | | |
Compensation and employee benefits | | | | 18,928 | | | 19,191 | | | 18,531 | | | 20,284 | | | 18,716 | | | 76,934 | | | 78,255 | | |
Rent and occupancy costs | | | | 7,553 | | | 7,484 | | | 8,107 | | | 7,822 | | | 8,111 | | | 30,966 | | | 34,186 | | |
Net loss on sale of foreclosed real estate and other repossessed assets | | | | 1,219 | | | 2,970 | | | 4,163 | | | 1,930 | | | 4,197 | | | 10,282 | | | 30,445 | (b) | |
General and administrative expenses | | | | 22,592 | | | 21,562 | | | 20,821 | | | 22,566 | | | 25,512 | | | 87,541 | | | 93,507 | | |
Total operating expenses | | | | 50,292 | | | 51,207 | | | 51,622 | | | 52,602 | | | 56,536 | | | 205,723 | | | 236,393 | | |
Credit related expenses | | | | 2,090 | | | 3,719 | | | 2,203 | | | 2,255 | | | 2,006 | | | 10,267 | | | 11,091 | | |
Other non-recurring expenses | | | | - | | | - | | | - | | | - | | | - | | | - | | | 917 | (e) | |
Total non-interest expense | | | | 52,382 | | | 54,926 | | | 53,825 | | | 54,857 | | | 58,542 | | | 215,990 | | | 248,401 | | |
Income (loss) before income taxes | | | | 26,404 | | | 18,747 | | | 20,197 | | | 19,832 | | | (20,840) | | | 85,180 | | | (20,058) | | |
Income tax expense (benefit) | (21) | | | 10,848 | | | 3,627 | | | 5,858 | | | 5,661 | | | (19,864) | | | 25,994 | | | (17,554) | | |
Net income (loss) | | | | 15,556 | | | 15,120 | | | 14,339 | | | 14,171 | | | (976) | | | 59,186 | | | (2,504) | | |
Less: dividends on preferred stock | | | | | | | | | | | | | | | | | | | | | | | | |
Convertible preferred stock | | | | (1,837) | | | (1,838) | | | (1,837) | | | (1,838) | | | (1,837) | | | (7,350) | | | (7,350) | | |
Other preferred stock | | | | (1,629) | | | (1,627) | | | (1,629) | | | (1,627) | | | (1,629) | | | (6,512) | | | (6,512) | | |
Net income (loss) available to common shareholders | | | $ | 12,090 | | $ | 11,655 | | $ | 10,873 | | $ | 10,706 | | $ | (4,442) | | $ | 45,324 | | $ | (16,366) | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
(a) During Q1 2015, the Company placed its $200 million participation in a fuel purchase line of credit with the Puerto Rico Electric Power Authority (PREPA) on non-accrual status and recorded a $24.0 million provision for loan and lease losses. During Q4 2015, the Company recorded an additional $29.3 million provision for loan and lease losses related to PREPA. Both were part of the overall quarterly provision for loan and lease losses. | |
(b) During Q3 2015, the Company sold a portion of covered non-performing commercial loans amounting to $197.1 million unpaid principal balance or UPB ($100.0 million carrying amount). The sales price was 18.44% of UPB, or $36.3 million. The FDIC agreed to cover $20.0 million of losses as part of its loss-share agreement with the Company. As a result, a $20.0 million reimbursement was recorded in the statement of operations. The Company also recorded a $32.9 million provision for loan and lease losses for acquired Eurobank loans, which was partially offset by $4.6 million in cost recoveries. Also, as part of this transaction, the Company sold certain non-performing commercial loans and real estate owned from the BBVAPR acquisition amounting to $38.1 million UPB ($9.9 million carrying amount). The sales price was $5.2 million. As a result, a $5.2 million provision for loan and lease losses was recorded for BBVAPR acquired loans, which was partially offset by $2.4 million in cost recoveries. In addition, certain real estate owned with a carrying amount of $11.0 million was sold for $1.7 million. At September 30 , 2015, the Company had a $13.0 million receivable related to this sale and a $20.0 million receivable from the FDIC for the shared-loss portion, both balances were received in December 2015. | |
(c) The FDIC loss share coverage for the commercial loans and other non-single family loans was in effect until June 30, 2015. The FDIC granted an extension of 120 days for the sale of part of this portfolio and agreed to cover up to $20 million with respect to the aggregate loss resulting from this sale. | |
(d) During Q1 2016, the Company sold mortgage backed securities amounting to $263.3 million for a gain of $16.1 million and obligations of Puerto Rico government and political subdivisions of $12.8 million for a loss of $4.1 million. In addition, the Company partially unwound repurchase agreements in the amount of $268 million at a cost of $12 million. | |
(e) During Q3 2015, the Company offered a voluntary early retirement program for qualified employees and incurred additional compensation expenses of $917 thousand related to this program. | |
(f) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. | |
(g) During Q3 2016, the Company received $5 million from a 2009 claim of loss related to a private label collaterized obligation. | |
| | | | | | | | | | | | | | | | | | | | | | | | |
3 | | |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | |
Table 3: Consolidated Statements of Financial Condition | | | | | | | | | |
| | | December 31, | | September 30, | | June 30, | | March 31, | | December 31, | |
(Dollars in thousands) (unaudited) | | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | |
Cash and cash equivalents | | | $ | 513,469 | | $ | 512,295 | | $ | 520,078 | | $ | 681,198 | | $ | 540,058 | |
Investments: | | | | | | | | | | | | | | | | | |
Trading securities | | | | 347 | | | 380 | | | 348 | | | 314 | | | 288 | |
Investment securities available-for-sale, at fair value, with amortized cost of $749,867 | | | | | | | | | | | | | | | | | |
(September 30, 2016 - $623,994; June 30, 2016 - $645,298; March 31, 2016 - $653,673; | | | | | | | | | | | | | | | | | |
December 31, 2015 - $955,646) | | | | | | | | | | | | | | | | | |
Mortgage-backed securities | (22) | | | 692,552 | | | 632,429 | | | 651,724 | | | 656,137 | (a) | | 953,213 | |
Other investment securities | (23) | | | 58,932 | | | 10,254 | | | 12,578 | | | 13,148 | (a) | | 21,396 | |
Total investment securities available-for-sale | | | | 751,484 | | | 642,683 | | | 664,302 | | | 669,285 | | | 974,609 | |
Mortgage-backed securities held-to-maturity, at amortized cost, with fair value of $592,763 | | | | | | | | | | | | | | | | | |
(September 30, 2016 - $650,023; June 30, 2016 - $643,530; March 31, 2016 - $641,346; | | | | | | | | | | | | | | | | | |
December 31, 2015 - $614,679) | (24) | | | 599,884 | | | 641,890 | | | 635,399 | | | 637,036 | | | 620,189 | |
Federal Home Loan Bank (FHLB) stock, at cost | | | | 10,793 | | | 12,712 | | | 19,838 | | | 20,761 | | | 20,783 | |
Other investments | | | | 3 | | | 3 | | | 3 | | | 3 | | | 3 | |
Total investments | | | | 1,362,511 | | | 1,297,668 | | | 1,319,890 | | | 1,327,399 | | | 1,615,872 | |
Loans, net | | | | 4,147,692 | | | 4,298,965 | (b) | | 4,373,617 | | | 4,360,129 | | | 4,434,213 | |
Other assets: | | | | | | | | | | | | | | | | | |
FDIC shared-loss indemnification asset | | | | 14,411 | | | 16,670 | | | 18,426 | | | 20,923 | | | 22,599 | |
Derivative assets | | | | 1,330 | | | 1,503 | | | 1,926 | | | 2,662 | | | 3,025 | |
Prepaid expenses | | | | 17,096 | | | 19,514 | | | 16,332 | | | 10,363 | | | 11,762 | |
Deferred tax asset, net | | | | 124,200 | | | 131,061 | | | 143,048 | | | 145,518 | | | 145,901 | |
Foreclosed real estate and repossessed properties | | | | 50,743 | | | 49,188 | | | 55,086 | | | 61,145 | | | 64,088 | |
Premises and equipment, net | | | | 70,407 | | | 71,105 | | | 72,585 | | | 73,975 | | | 74,590 | |
Goodwill | | | | 86,069 | | | 86,069 | | | 86,069 | | | 86,069 | | | 86,069 | |
Accounts receivable and other assets | | | | 113,896 | | | 108,075 | | | 105,539 | | | 105,191 | | | 100,972 | |
Total assets | | | $ | 6,501,824 | | $ | 6,592,113 | | $ | 6,712,596 | | $ | 6,874,572 | | $ | 7,099,149 | |
| | | | | | | | | | | | | | | | | |
Deposits: | | | | | | | | | | | | | | | | | |
Demand deposits | | | $ | 1,939,764 | | | 2,012,255 | | | 1,972,743 | | | 2,018,346 | | | 1,862,572 | |
Savings accounts | | | | 1,128,190 | | | 1,118,783 | | | 1,110,423 | | | 1,110,469 | | | 1,107,618 | |
Time deposits | | | | 1,020,138 | | | 1,042,572 | | | 999,243 | | | 962,773 | | | 964,588 | |
Brokered deposits | | | | 576,395 | | | 581,161 | | | 561,645 | | | 688,105 | | | 782,973 | |
Total deposits | | | | 4,664,487 | | | 4,754,771 | | | 4,644,054 | | | 4,779,693 | | | 4,717,751 | |
Borrowings: | | | | | | | | | | | | | | | | | |
Securities sold under agreements to repurchase | | | | 653,756 | | | 658,232 | | | 626,109 | | | 636,172 | (a) | | 934,691 | |
Advances from FHLB and other borrowings | | | | 105,515 | | | 105,984 | (c) | | 308,233 | | | 333,736 | | | 334,210 | |
Subordinated capital notes | | | | 36,083 | | | 36,083 | (c) | | 102,983 | | | 102,808 | | | 102,633 | |
Total borrowings | | | | 795,354 | | | 800,299 | | | 1,037,325 | | | 1,072,716 | | | 1,371,534 | |
Other liabilities: | | | | | | | | | | | | | | | | | |
Derivative liabilities | | | | 2,437 | | | 4,306 | | | 5,413 | | | 6,220 | | | 6,162 | |
Acceptances outstanding | | | | 23,765 | | | 18,043 | | | 20,984 | | | 19,381 | | | 14,582 | |
Accrued expenses and other liabilities | | | | 95,370 | | | 89,760 | | | 88,930 | | | 92,761 | | | 92,043 | |
Total liabilities | | | | 5,581,413 | | | 5,667,179 | | | 5,796,706 | | | 5,970,771 | | | 6,202,072 | |
Stockholders' equity: | | | | | | | | | | | | | | | | | |
Preferred stock | | | | 176,000 | | | 176,000 | | | 176,000 | | | 176,000 | | | 176,000 | |
Common stock | | | | 52,626 | | | 52,626 | | | 52,626 | | | 52,626 | | | 52,626 | |
Additional paid-in capital | | | | 540,948 | | | 540,692 | | | 540,705 | | | 540,371 | | | 540,512 | |
Legal surplus | | | | 76,293 | | | 74,788 | | | 73,265 | | | 71,865 | | | 70,435 | |
Retained earnings | | | | 177,808 | | | 169,858 | | | 162,363 | | | 155,529 | | | 148,886 | |
Treasury stock, at cost | | | | (104,860) | | | (104,874) | | | (104,874) | | | (104,874) | | | (105,379) | |
Accumulated other comprehensive income, net | | | | 1,596 | | | 15,844 | | | 15,805 | | | 12,284 | | | 13,997 | |
Total stockholders' equity | | | | 920,411 | | | 924,934 | | | 915,890 | | | 903,801 | | | 897,077 | |
Total liabilities and stockholders' equity | | | $ | 6,501,824 | | $ | 6,592,113 | | $ | 6,712,596 | | $ | 6,874,572 | | $ | 7,099,149 | |
| | | | | | | | | | | | | | | | | |
(a) During Q1 2016, the Company sold mortgage backed securities amounting to $263.3 million for a gain of $16.1 million and obligations of Puerto Rico government and political subdivisions of $12.8 million for a loss of $4.1 million. In addition, the Company partially unwound repurchase agreements in the amount of $268 million at a cost of $12 million. |
(b) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. |
(c) During Q3 2016, the Company paid-off, at maturity, $205.0 million in FHLB advances and a former BBVA subordinated capital note of $67.0 million, assumed as part of the 2012 acquisition of its PR operations. |
| | | | | | | | | | | | | | | | | |
4 | |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | |
Table 4: Information on Loan Portfolio and Production | | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| | | December 31, | | September 30, | | June 30, | | March 31, | | December 31, | |
(Dollars in thousands) (unaudited) | | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | |
Non-acquired loans held for investment: | | | | | | | | | | | | | | | | | |
Mortgage | | | $ | 721,494 | | $ | 735,367 | | $ | 741,917 | | $ | 751,819 | | $ | 757,828 | |
Commercial | | | | 1,277,866 | | | 1,267,177 | (b) | | 1,476,613 | | | 1,425,385 | | | 1,441,649 | |
Consumer | | | | 290,515 | | | 278,666 | | | 265,269 | | | 252,327 | | | 242,950 | |
Auto | | | | 756,395 | | | 730,589 | | | 712,268 | | | 687,159 | | | 669,163 | |
| | | | 3,046,270 | | | 3,011,799 | | | 3,196,067 | | | 3,116,690 | | | 3,111,590 | |
Less: Allowance for loan and lease losses | | | | (59,301) | | | (62,168) | (b) | | (112,812) | | | (113,238) | | | (112,626) | |
| | | | 2,986,969 | | | 2,949,631 | | | 3,083,255 | | | 3,003,452 | | | 2,998,964 | |
Deferred loan costs, net | | | | 5,766 | | | 5,421 | | | 4,619 | | | 4,350 | | | 4,203 | |
Total non-acquired loans held for investment, net | | | | 2,992,735 | | | 2,955,052 | | | 3,087,874 | | | 3,007,802 | | | 3,003,167 | |
| | | | | | | | | | | | | | | | | |
Acquired loans: | (1) | | | | | | | | | | | | | | | | |
BBVAPR | | | | | | | | | | | | | | | | | |
Accounted for under ASC 310-20 | | | | | | | | | | | | | | | | | |
Commercial | | | | 5,562 | | | 5,755 | | | 4,559 | | | 6,558 | | | 7,457 | |
Consumer | | | | 32,862 | | | 34,215 | | | 35,194 | | | 36,346 | | | 38,385 | |
Auto | | | | 53,026 | | | 64,393 | | | 77,118 | | | 91,406 | | | 106,911 | |
| | | | 91,450 | | | 104,363 | | | 116,871 | | | 134,310 | | | 152,753 | |
Less: Allowance for loan and lease losses | | | | (4,299) | | | (4,213) | | | (4,487) | | | (4,993) | | | (5,542) | |
| | | | 87,151 | | | 100,150 | | | 112,384 | | | 129,317 | | | 147,211 | |
| | | | | | | | | | | | | | | | | |
Accounted for under ASC 310-30 | | | | | | | | | | | | | | | | | |
Mortgage | | | | 569,253 | | | 579,769 | | | 591,029 | | | 600,901 | | | 608,294 | |
Commercial | | | | 292,564 | | | 301,599 | | | 323,105 | | | 345,789 | | | 375,491 | |
Consumer | | | | 4,301 | | | 5,768 | | | 7,331 | | | 9,345 | | | 11,843 | |
Auto | | | | 85,676 | | | 100,475 | | | 117,038 | | | 134,669 | | | 153,592 | |
| | | | 951,794 | | | 987,611 | | | 1,038,503 | (a) | | 1,090,704 | | | 1,149,220 | |
Less: Allowance for loan and lease losses | | | | (31,056) | | | (29,819) | | | (22,801) | (a) | | (27,747) | | | (25,785) | |
| | | | 920,738 | | | 957,792 | | | 1,015,702 | | | 1,062,957 | | | 1,123,435 | |
Total Acquired BBVAPR loans, net | | | | 1,007,889 | | | 1,057,942 | | | 1,128,086 | | | 1,192,274 | | | 1,270,646 | |
| | | | | | | | | | | | | | | | | |
Eurobank | | | | | | | | | | | | | | | | | |
Accounted for under ASC 310-30 | | | | | | | | | | | | | | | | | |
Mortgage | | | | 73,018 | | | 75,043 | | | 76,777 | | | 91,113 | | | 92,273 | |
Commercial | | | | 81,460 | | | 82,753 | | | 83,377 | | | 142,298 | | | 142,377 | |
Consumer | | | | 1,372 | | | 1,488 | | | 1,410 | | | 1,770 | | | 2,314 | |
| | | | 155,850 | | | 159,284 | | | 161,564 | (a) | | 235,181 | | | 236,964 | |
Less: Allowance for loan and lease losses | | | | (21,281) | | | (22,812) | | | (22,116) | (a) | | (92,293) | | | (90,178) | |
Total Acquired Eurobank loans, net | | | | 134,569 | | | 136,472 | | | 139,448 | | | 142,888 | | | 146,786 | |
Total acquired loans, net | | | | 1,142,458 | | | 1,194,414 | | | 1,267,534 | | | 1,335,162 | | | 1,417,432 | |
Total loans held for investment | | | | 4,135,193 | | | 4,149,466 | | | 4,355,408 | | | 4,342,964 | | | 4,420,599 | |
Mortgage loans held for sale | | | | 12,499 | | | 26,362 | | | 18,209 | | | 17,165 | | | 13,614 | |
Other loans held for sale | | | | - | | | 123,137 | (b) | | - | | | - | | | - | |
Total loans, net | | | $ | 4,147,692 | | $ | 4,298,965 | | $ | 4,373,617 | | $ | 4,360,129 | | $ | 4,434,213 | |
| | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
| | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | |
(Dollars in thousands) (unaudited) | | | Q4 | | Q3 | | Q2 | | Q1 | | Q4 | |
Quarterly loan production | (13) | | | | | | | | | | | | | | | | |
Mortgage | | | $ | 51,208 | | $ | 51,022 | | $ | 57,636 | | $ | 48,321 | | $ | 55,450 | |
Commercial | | | | 86,832 | | | 62,628 | | | 66,316 | | | 79,272 | | | 75,775 | |
Consumer | | | | 42,295 | | | 43,636 | | | 39,550 | | | 34,275 | | | 37,919 | |
Auto and Leasing | | | | 77,602 | | | 69,523 | | | 74,383 | | | 63,285 | | | 67,633 | |
Total | | | $ | 257,937 | | $ | 226,809 | | $ | 237,885 | | $ | 225,153 | | $ | 236,777 | |
| | | | | | | | | | | | | | | | | |
(a) During Q2 2016, the Company changed the purchase credit impaired policy for all loans accounted for under ASC 310-30. Under the revised policy, the Company writes-off a loans' recorded investment and derecognizes the associated allowance for loan and lease losses for loans that exit the pools. The revised policy implementation was performed prospectively due to the immaterial impact for retrospective adoption. The transition to this revised policy resulted in an $8.5 million and $72.2 million initial de-recognition of loans recorded investment balance and associated allowance for loan and lease losses for acquired BBVAPR loans and acquired Eurobank loans, respectively, with no impact to the provision for loan and lease losses. |
(b) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. |
| | | | | | | | | | | | | | | | | |
5 | |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Table 5: Average Balances, Net Interest Income and Net Interest Margin | |
| | | 2016 Q4 | | 2016 Q3 | | 2016 Q2 | | 2016 Q1 | | 2015 Q4 |
| | | | | Interest | | | | | | | Interest | | | | | | | Interest | | | | | | | Interest | | | | | | | Interest | | | |
| | | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ |
(Dollars in thousands) (unaudited) | | | Balance | | Expense | | Rate | | Balance | | Expense | | Rate | | Balance | | Expense | | Rate | | Balance | | Expense | | Rate | | Balance | | Expense | | Rate |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest earning assets: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cash equivalents and securities purchased under agreements to resell | | | $ | 445,246 | | $ | 581 | | 0.52 | % | | $ | 477,968 | | $ | 661 | | 0.55 | % | | $ | 512,916 | | $ | 612 | | 0.48 | % | | $ | 502,718 | | $ | 646 | | 0.52 | % | | $ | 438,981 | | $ | 327 | | 0.30 | % |
Investment securities | | | | 1,330,951 | | | 7,699 | | 2.30 | % | | | 1,293,251 | | | 7,319 | | 2.25 | % | | | 1,311,468 | | | 7,621 | | 2.33 | % | | | 1,450,127 | | | 9,508 | | 2.63 | % | | | 1,609,399 | | | 10,209 | | 2.52 | % |
Loans | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Non-acquired loans | | | | 3,009,579 | | | 51,581 | | 6.82 | % | | | 3,160,091 | | | 50,569 | | 6.35 | % | | | 3,129,570 | | | 49,108 | | 6.29 | % | | | 3,100,157 | | | 47,915 | | 6.20 | % | | | 3,043,109 | | | 47,261 | | 6.16 | % |
Acquired BBVAPR loans | | | | 1,050,468 | | | 20,232 | | 7.66 | % | | | 1,100,336 | | | 22,723 | | 8.19 | % | | | 1,172,087 | | | 23,670 | | 8.10 | % | | | 1,240,252 | | | 25,676 | | 8.30 | % | | | 1,361,173 | | | 26,976 | | 7.86 | % |
Acquired Eurobank loans | | | | 135,918 | | | 6,701 | | 19.61 | % | | | 137,605 | | | 9,313 | | 26.85 | % | | | 144,001 | | | 6,897 | | 19.21 | % | | | 144,001 | | | 7,561 | | 21.06 | % | | | 147,952 | | | 8,134 | | 21.81 | % |
Total loans | | | | 4,195,966 | | | 78,514 | | 7.44 | % | | | 4,398,032 | | | 82,605 | | 7.45 | % | | | 4,445,658 | | | 79,675 | | 7.19 | % | | | 4,484,410 | | | 81,152 | | 7.26 | % | | | 4,552,234 | | | 82,371 | | 7.18 | % |
Total interest-earning assets | | | $ | 5,972,163 | | $ | 86,794 | | 5.78 | % | | $ | 6,169,251 | | $ | 90,585 | | 5.83 | % | | $ | 6,270,042 | | $ | 87,908 | | 5.62 | % | | $ | 6,437,255 | | $ | 91,306 | | 5.69 | % | | $ | 6,600,614 | | $ | 92,907 | | 5.58 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Interest bearing liabilities: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Deposits | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
NOW accounts | | | $ | 1,119,597 | | $ | 1,172 | | 0.42 | % | | $ | 1,243,640 | | $ | 1,314 | | 0.42 | % | | $ | 1,231,576 | | $ | 1,518 | | 0.49 | % | | $ | 1,152,055 | | $ | 1,081 | | 0.38 | % | | $ | 1,138,928 | | $ | 1,063 | | 0.37 | % |
Savings accounts | | | | 1,126,600 | | | 1,384 | | 0.49 | % | | | 1,113,649 | | | 1,351 | | 0.48 | % | | | 1,103,808 | | | 1,308 | | 0.48 | % | | | 1,115,552 | | | 1,398 | | 0.50 | % | | | 1,180,220 | | | 1,516 | | 0.51 | % |
Time deposits | | | | 1,045,732 | | | 2,794 | | 1.06 | % | | | 1,013,905 | | | 2,735 | | 1.07 | % | | | 981,759 | | | 2,558 | | 1.05 | % | | | 954,857 | | | 2,495 | | 1.05 | % | | | 938,291 | | | 2,456 | | 1.04 | % |
Brokered deposits | | | | 583,607 | | | 1,895 | | 1.29 | % | | | 549,371 | | | 1,751 | | 1.26 | % | | | 612,137 | | | 1,816 | | 1.19 | % | | | 734,326 | | | 1,988 | | 1.09 | % | | | 673,570 | | | 1,438 | | 0.85 | % |
| | | | 3,875,536 | | | 7,245 | | 0.74 | % | | | 3,920,565 | | | 7,151 | | 0.72 | % | | | 3,929,280 | | | 7,200 | | 0.73 | % | | | 3,956,790 | | | 6,962 | | 0.71 | % | | | 3,931,009 | | | 6,473 | | 0.65 | % |
Non-interest bearing deposit accounts | | | | 832,332 | | | - | | - | | | | 801,833 | | | - | | - | | | | 774,496 | | | - | | - | | | | 774,950 | | | - | | - | | | | 781,064 | | | - | | - | % |
Fair value premium amortization and core deposit intangible amortization | | | | - | | | 186 | | - | | | | - | | | 180 | | - | | | | - | | | 167 | | - | | | | - | | | 162 | | - | | | | - | | | 202 | | - | |
Total deposits | | | | 4,707,868 | | | 7,431 | | 0.63 | % | | | 4,722,398 | | | 7,331 | | 0.62 | % | | | 4,703,776 | | | 7,367 | | 0.63 | % | | | 4,731,740 | | | 7,124 | | 0.60 | % | | | 4,712,073 | | | 6,675 | | 0.56 | % |
Borrowings | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Securities sold under agreements to repurchase | | | | 608,802 | | | 4,177 | | 2.73 | % | | | 620,353 | | | 4,272 | | 2.73 | % | | | 627,693 | | | 4,258 | | 2.72 | % | | | 799,613 | | | 6,099 | | 3.06 | % | | | 957,680 | | | 7,404 | | 3.07 | % |
Advances from FHLB and other borrowings | | | | 105,561 | | | 611 | | 2.30 | % | | | 195,278 | | | 1,237 | | 2.51 | % | | | 317,191 | | | 2,098 | | 2.65 | % | | | 337,364 | | | 2,240 | | 2.66 | % | | | 334,029 | | | 2,306 | | 2.74 | % |
Subordinated capital notes | | | | 36,083 | | | 362 | | 3.99 | % | | | 101,581 | | | 818 | | 3.19 | % | | | 102,869 | | | 873 | | 3.40 | % | | | 102,695 | | | 868 | | 3.39 | % | | | 102,462 | | | 900 | | 3.48 | % |
Total borrowings | | | | 750,446 | | | 5,150 | | 2.73 | % | | | 917,212 | | | 6,327 | | 2.74 | % | | | 1,047,753 | | | 7,229 | | 2.77 | % | | | 1,239,672 | | | 9,207 | | 2.98 | % | | | 1,394,171 | | | 10,610 | | 3.02 | % |
Total interest-bearing liabilities | | | $ | 5,458,314 | | $ | 12,581 | | 0.92 | % | | $ | 5,639,610 | | $ | 13,658 | | 0.96 | % | | $ | 5,751,529 | | $ | 14,596 | | 1.02 | % | | $ | 5,971,412 | | $ | 16,331 | | 1.10 | % | | $ | 6,106,244 | | $ | 17,285 | | 1.12 | % |
Interest rate spread | | | | | | $ | 74,213 | | 4.86 | % | | | | | $ | 76,927 | | 4.87 | % | | | | | $ | 73,312 | | 4.60 | % | | | | | $ | 74,975 | | 4.59 | % | | | | | $ | 75,622 | | 4.46 | % |
Net interest margin | | | | | | | | | 4.94 | % | | | | | | | | 4.95 | % | | | | | | | | 4.69 | % | | | | | | | | 4.67 | % | | | | | | | | 4.55 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
ASC 310-30 loan cost recoveries: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Acquired BBVAPR loans | | | | | | $ | 130 | | | | | | | | $ | 809 | | | | | | | | $ | 293 | | | | | | | | $ | 683 | | | | | | | | $ | 354 | | | |
Acquired Eurobank loans | | | | | | | 729 | | | | | | | | | 3,012 | | | | | | | | | 539 | | | | | | | | | 1,326 | | | | | | | | | 2,397 | | | |
| | | | | | $ | 859 | | | | | | | | $ | 3,821 | | | | | | | | $ | 832 | | | | | | | | $ | 2,009 | | | | | | | | $ | 2,751 | | | |
Adjusted excluding cost recoveries (Non-GAAP): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Total interest-earning assets | | | $ | 5,972,163 | | $ | 85,935 | | 5.72 | % | | $ | 6,169,251 | | $ | 86,764 | | 5.58 | % | | $ | 6,270,042 | | $ | 87,076 | | 5.57 | % | | $ | 6,437,255 | | $ | 89,297 | | 5.56 | % | | $ | 6,600,614 | | $ | 90,156 | | 5.42 | % |
Interest rate spread | | | | | | $ | 73,354 | | 4.80 | % | | | | | $ | 73,106 | | 4.62 | % | | | | | $ | 72,480 | | 4.55 | % | | | | | $ | 72,966 | | 4.46 | % | | | | | $ | 72,871 | | 4.30 | % |
Net interest margin | | | | | | | | | 4.89 | % | | | | | | | | 4.70 | % | | | | | | | | 4.64 | % | | | | | | | | 4.55 | % | | | | | | | | 4.38 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
6 |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | |
Table 5: Average Balances, Net Interest Income and Net Interest Margin (Continued) | |
| | | 2016 YTD | | 2015 YTD | |
| | | | | Interest | | | | | | | Interest | | | | |
| | | Average | | Income/ | | Yield/ | | Average | | Income/ | | Yield/ | |
(Dollars in thousands) (unaudited) | | | Balance | | Expense | | Rate | | Balance | | Expense | | Rate | |
| | | | | | | | | | | | | | | | | | | | |
Interest earning assets: | | | | | | | | | | | | | | | | | | | | |
Cash equivalents and securities purchased under agreements to resell | | | $ | 484,586 | | $ | 2,501 | | 0.52 | % | | $ | 491,051 | | $ | 1,280 | | 0.26 | % | |
Investment securities | | | | 1,346,261 | | | 32,146 | | 2.39 | % | | | 1,509,667 | | | 37,666 | | 2.49 | % | |
Loans | | | | | | | | | | | | | | | | | | | | |
Non-acquired loans | | | | 3,098,701 | | | 199,172 | | 6.43 | % | | | 2,940,713 | | | 183,820 | | 6.25 | % | |
Acquired BBVAPR loans | | | | 1,145,116 | | | 92,273 | | 8.06 | % | | | 1,550,356 | | | 131,392 | | 8.47 | % | |
Acquired Eurobank loans | | | | 139,670 | | | 30,499 | | 21.84 | % | | | 213,208 | | | 52,410 | | 24.58 | % | |
Total loans | | | | 4,383,487 | | | 321,944 | | 7.34 | % | | | 4,704,278 | | | 367,622 | | 7.81 | % | |
Total interest-earning assets | | | $ | 6,214,334 | | $ | 356,591 | | 5.74 | % | | $ | 6,704,996 | | $ | 406,568 | | 6.06 | % | |
| | | | | | | | | | | | | | | | | | | | |
Interest bearing liabilities: | | | | | | | | | | | | | | | | | | | | |
Deposits | | | | | | | | | | | | | | | | | | | | |
NOW accounts | | | $ | 1,200,394 | | $ | 5,086 | | 0.42 | % | | $ | 1,163,424 | | $ | 4,451 | | 0.38 | % | |
Savings accounts | | | | 1,114,931 | | | 5,441 | | 0.49 | % | | | 1,256,909 | | | 6,504 | | 0.52 | % | |
Time deposits | | | | 999,231 | | | 10,583 | | 1.06 | % | | | 958,912 | | | 10,669 | | 1.11 | % | |
Brokered deposits | | | | 619,569 | | | 7,450 | | 1.20 | % | | | 624,210 | | | 4,900 | | 0.78 | % | |
| | | | 3,934,125 | | | 28,560 | | 0.73 | % | | | 4,003,456 | | | 26,524 | | 0.66 | % | |
Non-interest bearing deposit accounts | | | | 781,877 | | | - | | - | | | | 769,790 | | | - | | - | % | |
Fair value premium amortization and core deposit intangible amortization | | | | - | | | 693 | | - | | | | - | | | 510 | | - | | |
Total deposits | | | | 4,716,002 | | | 29,253 | | 0.62 | % | | | 4,773,246 | | | 27,034 | | 0.57 | % | |
Borrowings | | | | | | | | | | | | | | | | | | | | |
Securities sold under agreements to repurchase | | | | 663,845 | | | 18,804 | | 2.83 | % | | | 1,012,756 | | | 29,567 | | 2.92 | % | |
Advances from FHLB and other borrowings | | | | 238,366 | | | 6,186 | | 2.60 | % | | | 338,299 | | | 9,072 | | 2.68 | % | |
Subordinated capital notes | | | | 85,714 | | | 2,921 | | 3.41 | % | | | 102,071 | | | 3,523 | | 3.45 | % | |
Total borrowings | | | | 987,925 | | | 27,911 | | 2.83 | % | | | 1,453,126 | | | 42,162 | | 2.90 | % | |
Total interest-bearing liabilities | | | $ | 5,703,927 | | $ | 57,164 | | 1.00 | % | | $ | 6,226,372 | | $ | 69,196 | | 1.11 | % | |
Interest rate spread | | | | | | $ | 299,427 | | 4.74 | % | | | | | $ | 337,372 | | 4.95 | % | |
Net interest margin | | | | | | | | | 4.82 | % | | | | | | | | 5.03 | % | |
| | | | | | | | | | | | | | | | | | | | |
ASC 310-30 loan cost recoveries: | | | | | | | | | | | | | | | | | | | | |
Acquired BBVAPR loans | | | | | | $ | 1,915 | | | | | | | | | 8,765 | | | | |
Acquired Eurobank loans | | | | | | | 5,606 | | | | | | | | | 14,065 | | | | |
| | | | | | $ | 7,521 | | | | | | | | $ | 22,830 | | | | |
Adjusted excluding cost recoveries (Non-GAAP): | | | | | | | | | | | | | | | | | | | | |
Total interest-earning assets | | | $ | 6,214,334 | | $ | 349,070 | | 5.62 | % | | $ | 6,704,996 | | $ | 383,738 | | 5.72 | % | |
Interest rate spread | | | | | | $ | 291,906 | | 4.62 | % | | | | | $ | 314,542 | | 4.61 | % | |
Net interest margin | | | | | | | | | 4.70 | % | | | | | | | | 4.69 | % | |
| | | | | | | | | | | | | | | | | | | | |
7 | | |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | |
Table 6: Loan Information and Performance Statistics (Excluding Acquired Loans) (1) | | | |
| | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 |
(Dollars in thousands) (unaudited) | | | Q4 | | Q3 | | Q2 | | Q1 | | Q4 |
Net Charge-offs | | | | | | | | | | | | | | | | |
Mortgage: | | | | | | | | | | | | | | | | |
Charge-offs | | | $ | 2,075 | | $ | 1,656 | | $ | 1,374 | | $ | 1,662 | | $ | 1,568 |
Recoveries | | | | (125) | | | (21) | | | (36) | | | (145) | | | (53) |
Total mortgage | | | | 1,950 | | | 1,635 | | | 1,338 | | | 1,517 | | | 1,515 |
Commercial: | | | | | | | | | | | | | | | | |
Charge-offs | | | | 3,901 | | | 56,700 | (a) | | 833 | | | 1,011 | | | 3,229 |
Recoveries | | | | (53) | | | (93) | | | (228) | | | (88) | | | (60) |
Total commercial | | | | 3,848 | | | 56,607 | (a) | | 605 | | | 923 | | | 3,169 |
Consumer: | | | | | | | | | | | | | | | | |
Charge-offs | | | | 3,243 | | | 3,173 | | | 2,811 | | | 2,327 | | | 2,227 |
Recoveries | | | | (97) | | | (120) | | | (133) | | | (102) | | | (142) |
Total consumer | | | | 3,146 | | | 3,053 | | | 2,678 | | | 2,225 | | | 2,085 |
Auto and Leasing: | | | | | | | | | | | | | | | | |
Charge-offs | | | | 7,464 | | | 7,804 | | | 8,100 | | | 8,362 | | | 9,068 |
Recoveries | | | | (2,902) | | | (3,747) | | | (3,243) | | | (2,979) | | | (3,100) |
Total auto and leasing | | | | 4,562 | | | 4,057 | | | 4,857 | | | 5,383 | | | 5,968 |
Total | | | $ | 13,506 | | $ | 65,352 | (a) | $ | 9,478 | | $ | 10,048 | | $ | 12,737 |
Net Charge-off Rates | | | | | | | | | | | | | | | | |
Mortgage | | | | 1.07% | | | 0.88% | | | 0.72% | | | 0.80% | | | 0.80% |
Commercial | | | | 1.22% | | | 15.88% | (a) | | 0.17% | | | 0.26% | | | 0.91% |
Consumer | | | | 4.62% | | | 4.71% | | | 4.35% | | | 3.80% | | | 3.68% |
Auto and Leasing | | | | 2.44% | | | 2.23% | | | 2.75% | | | 3.15% | | | 3.59% |
Total | | | | 1.80% | | | 8.27% | (a) | | 1.21% | | | 1.30% | | | 1.67% |
Average Loans Held For Investment | | | | | | | | | | | | | | | | |
Mortgage | | | $ | 730,707 | | $ | 746,613 | | $ | 743,516 | | $ | 756,291 | | $ | 756,530 |
Commercial | | | | 1,258,896 | | | 1,426,216 | | | 1,433,944 | | | 1,425,332 | | | 1,394,597 |
Consumer | | | | 272,353 | | | 259,535 | | | 246,003 | | | 234,499 | | | 226,783 |
Auto and Leasing | | | | 747,623 | | | 727,727 | | | 706,107 | | | 684,035 | | | 665,199 |
Total | | | $ | 3,009,579 | | $ | 3,160,091 | | $ | 3,129,570 | | $ | 3,100,157 | | $ | 3,043,109 |
| | | | | | | | | | | | | | | | |
(a) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. |
| | | | | | | | | | | | | | | | |
8 |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | |
Table 6: Loan Information and Performance Statistics (Excluding Acquired Loans) (Continued) (1) | |
| | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | |
(Dollars in thousands) (unaudited) | | | Q4 | | Q3 | | Q2 | | Q1 | | Q4 | |
Early Delinquency (30 - 89 days past due) | | | | | | | | | | | | | | | | | |
Mortgage | | | $ | 32,516 | | $ | 37,015 | | $ | 33,099 | | $ | 31,627 | | $ | 36,092 | |
Commercial | | | | 1,602 | | | 4,177 | | | 4,923 | | | 2,353 | | | 4,461 | |
Consumer | | | | 5,106 | | | 4,796 | | | 3,765 | (a) | | 4,341 | | | 4,128 | |
Auto and Leasing | | | | 61,728 | | | 65,302 | | | 63,871 | (a) | | 71,004 | | | 70,464 | |
Total | | | $ | 100,952 | | $ | 111,290 | | $ | 105,658 | | $ | 109,325 | | $ | 115,145 | |
Early Delinquency Rates (30 - 89 days past due) | | | | | | | | | | | | | | | | | |
Mortgage | | | | 4.51% | | | 5.03% | | | 4.46% | | | 4.21% | | | 4.76% | |
Commercial | | | | 0.13% | | | 0.33% | | | 0.33% | | | 0.17% | | | 0.31% | |
Consumer | | | | 1.76% | | | 1.72% | | | 1.42% | (a) | | 1.72% | | | 1.70% | |
Auto and Leasing | | | | 8.16% | | | 8.94% | | | 8.97% | (a) | | 10.33% | | | 10.53% | |
Total | | | | 3.31% | | | 3.70% | | | 3.31% | | | 3.51% | | | 3.70% | |
Total Delinquency (30 days and over past due) | | | | | | | | | | | | | | | | | |
Mortgage: | | | | | | | | | | | | | | | | | |
Traditional, Non traditional, and Loans under Loss Mitigation | | | $ | 98,506 | | $ | 103,770 | | $ | 95,909 | | $ | 97,424 | | $ | 102,988 | |
GNMA's buy-back option program | | | | 9,681 | | | 9,598 | | | 8,369 | | | 7,684 | | | 7,945 | |
Total mortgage | | | | 108,187 | | | 113,368 | | | 104,278 | | | 105,108 | | | 110,933 | |
Commercial | | | | 12,798 | | | 14,947 | | | 20,005 | | | 19,686 | | | 21,138 | |
Consumer | | | | 6,752 | | | 6,302 | | | 5,190 | (a) | | 5,934 | | | 5,171 | |
Auto and Leasing | | | | 69,901 | | | 73,708 | | | 71,193 | (a) | | 78,746 | | | 78,757 | |
Total | | | $ | 197,638 | | $ | 208,325 | | $ | 200,666 | | $ | 209,474 | | $ | 215,999 | |
Total Delinquency Rates (30 days and over past due) | | | | | | | | | | | | | | | | | |
Mortgage: | | | | | | | | | | | | | | | | | |
Traditional, Non traditional, and Loans under Loss Mitigation | | | | 13.65% | | | 14.11% | | | 12.93% | | | 12.96% | | | 13.59% | |
GNMA's buy-back option program | | | | 1.34% | | | 1.31% | | | 1.13% | | | 1.02% | | | 1.05% | |
Total mortgage | | | | 14.99% | | | 15.42% | | | 14.06% | | | 13.98% | | | 14.64% | |
Commercial | | | | 1.00% | | | 1.18% | | | 1.35% | | | 1.38% | | | 1.47% | |
Consumer | | | | 2.32% | | | 2.26% | | | 1.96% | (a) | | 2.35% | | | 2.13% | |
Auto and Leasing | | | | 9.24% | | | 10.09% | | | 10.00% | (a) | | 11.46% | | | 11.77% | |
Total | | | | 6.49% | | | 6.92% | | | 6.28% | | | 6.72% | | | 6.94% | |
Nonperforming Assets | (14) | | | | | | | | | | | | | | | | |
Mortgage | | | $ | 74,503 | | $ | 75,592 | | $ | 72,947 | | $ | 76,218 | | $ | 77,875 | |
Commercial | | | | 19,786 | | | 23,347 | (b) | | 207,768 | | | 212,345 | | | 215,281 | |
Consumer | | | | 1,986 | | | 2,470 | | | 2,339 | | | 2,039 | | | 1,631 | |
Auto and Leasing | | | | 9,052 | | | 9,477 | | | 7,337 | | | 7,873 | | | 8,418 | |
Total nonperforming loans | | | | 105,327 | | | 110,886 | | | 290,391 | | | 298,475 | | | 303,205 | |
Foreclosed real estate | | | | 11,867 | | | 9,819 | | | 10,463 | | | 10,502 | | | 9,772 | |
Other repossessed assets | | | | 2,408 | | | 2,462 | | | 2,979 | | | 2,796 | | | 3,845 | |
Total nonperforming assets | | | $ | 119,602 | | $ | 123,167 | | $ | 303,833 | | $ | 311,773 | | $ | 316,822 | |
Nonperforming Loan Rates | | | | | | | | | | | | | | | | | |
Mortgage | | | | 10.33% | | | 10.28% | | | 9.83% | | | 10.14% | | | 10.28% | |
Commercial | | | | 1.55% | | | 1.84% | (b) | | 14.07% | | | 14.90% | | | 14.93% | |
Consumer | | | | 0.68% | | | 0.89% | | | 0.88% | | | 0.81% | | | 0.67% | |
Auto and Leasing | | | | 1.20% | | | 1.30% | | | 1.03% | | | 1.15% | | | 1.26% | |
Total loans | | | | 3.46% | | | 3.68% | | | 9.09% | | | 9.58% | | | 9.74% | |
| | | | | | | | | | | | | | | | | |
(a) During Q2 2016, the Company changed its early delinquency reporting on consumer and auto loans from one scheduled payment due to two scheduled payments due. This change resulted in a $19 thousand and $5.9 million reduction in early and total delinquency for consumer loans and auto loans, respectively. | |
(b) During Q3 2016, the Company entered into an agreement to sell its outstanding participation in the PREPA line of credit for $124 million, slightly lower than the adjusted book balance, net of reserves. At September 30, 2016, this line of credit was reported as other loans held for sale, at fair value. Proceeds were received on October 7, 2016. As a result of this transaction, the Company recognized a $56.2 million charge-off and a $2.9 provision for loan and lease losses during the quarter ended September 30, 2016. | |
| | | | | | | | | | | | | | | | | |
9 | |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | | | |
Table 7: Allowance for Loan and Lease Losses | | | | | | | | | | | | |
| | | Quarter Ended December 31, 2016 |
| | | | | | | | | Auto and | | | | |
(Dollars in thousands) (unaudited) | | | Mortgage | | Commercial | | Consumer | | Leasing | | Unallocated | | Total |
Non-acquired loans | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 18,527 | | $ | 12,307 | | $ | 12,289 | | $ | 19,002 | | $ | 43 | | $ | 62,168 |
Provision for loan and lease losses,net | | | | 767 | | | 536 | | | 3,924 | | | 5,023 | | | 388 | | | 10,638 |
Charge-offs | | | | (2,075) | | | (3,901) | | | (3,243) | | | (7,464) | | | - | | | (16,683) |
Recoveries | | | | 125 | | | 53 | | | 97 | | | 2,902 | | | - | | | 3,177 |
Balance at end of period | | | $ | 17,344 | | $ | 8,995 | | $ | 13,067 | | $ | 19,463 | | $ | 431 | | $ | 59,300 |
Allowance coverage ratio | | | | 2.40% | | | 0.70% | | | 4.50% | | | 2.57% | | | 0.01% | | | 1.95% |
| | | | | | | | | | | | | | | | | | | |
Acquired loans | | | | | | | | | | | | | | | | | | | |
Acquired BBVAPR loans: | | | | | | | | | | | | | | | | | | | |
Acquired loans accounted for under ASC 310-20 | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | | | | $ | 18 | | $ | 2,946 | | $ | 1,249 | | $ | - | | $ | 4,213 |
Provision (recapture) for loan and lease losses, net | | | | | | | 154 | | | 922 | | | (214) | | | - | | | 862 |
Charge-offs | | | | | | | (21) | | | (905) | | | (372) | | | - | | | (1,298) |
Recoveries | | | | | | | 18 | | | 65 | | | 440 | | | - | | | 523 |
Balance at end of period | | | | | | $ | 169 | | $ | 3,028 | | $ | 1,103 | | $ | - | | $ | 4,300 |
| | | | | | | | | | | | | | | | | | | |
Acquired loans accounted for under ASC 310-30 | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 2,664 | | $ | 21,998 | | $ | - | | $ | 5,157 | | $ | - | | $ | 29,819 |
Provision for loan and lease losses, net | | | | 199 | | | 2,074 | | | - | | | - | | | - | | | 2,273 |
Allowance de-recognition and other adjustments | | | | (181) | | | (620) | | | - | | | (235) | | | - | | | (1,036) |
Balance at end of period | | | $ | 2,682 | | $ | 23,452 | | $ | - | | $ | 4,922 | | $ | - | | $ | 31,056 |
| | | | | | | | | | | | | | | | | | | |
Acquired Eurobank loans: | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 12,268 | | | 10,544 | | | - | | | - | | | - | | $ | 22,812 |
Provision (recapture) for loan and lease losses, net | | | | 2 | | | (402) | | | - | | | - | | | - | | | (400) |
FDIC shared-loss portion of provision for covered loan and lease losses, net | | | | 178 | | | - | | | - | | | - | | | - | | | 178 |
Allowance de-recognition and other adjustments | | | | (501) | | | (814) | | | 6 | | | - | | | - | | | (1,309) |
Balance at end of period | | | $ | 11,947 | | $ | 9,328 | | $ | 6 | | $ | - | | $ | - | | $ | 21,281 |
| | | | | | | | | | | | | | | | | | | |
Total acquired loans | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 14,932 | | | 32,560 | | | 2,946 | | | 6,406 | | | - | | | 56,844 |
Provision (recapture) for loan and lease losses, net | | | | 201 | | | 1,826 | | | 922 | | | (214) | | | - | | | 2,735 |
Charge-offs | | | | - | | | (21) | | | (905) | | | (372) | | | - | | | (1,298) |
Recoveries | | | | - | | | 18 | | | 65 | | | 440 | | | - | | | 523 |
FDIC shared-loss portion of provision for covered loan and lease losses, net | | | | 178 | | | - | | | - | | | - | | | - | | | 178 |
Allowance de-recognition and other adjustments | | | | (682) | | | (1,434) | | | 6 | | | (235) | | | - | | | (2,345) |
Balance at end of period | | | $ | 14,629 | | $ | 32,949 | | $ | 3,034 | | $ | 6,025 | | $ | - | | $ | 56,637 |
| | | | | | | | | | | | | | | | | | | |
10 |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | | | |
Table 8: Accretable Yield on Loans Accounted for Under ASC 310-30 (Loans Acquired with Deteriorated Credit Quality, including those by Analogy) |
| | | Quarter Ended December 31, 2016 |
(Dollars in thousands) (unaudited) | | | Mortgage | | Commercial | | Construction | | Auto | | Consumer | | Total |
Accretable Yield and Non-Accretable Discount | | | | | | | | | | | | | | | | | | | |
Acquired BBVAPR loans: | | | | | | | | | | | | | | | | | | | |
Accretable Yield | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 299,681 | | $ | 32,326 | | $ | 14,045 | | $ | 11,089 | | $ | 4,215 | | $ | 361,356 |
Accretion | | | | (8,036) | | $ | (4,131) | | $ | (1,150) | | $ | (2,633) | | $ | (512) | | $ | (16,462) |
Change in expected cash flows | | | | - | | | 8,995 | | | 519 | | | 2 | | | - | | | 9,516 |
Transfers from (to) non-accretable discount | | | | 470 | | | (73) | | | (165) | | | 80 | | | (21) | | | 291 |
Balance at end of period | | | $ | 292,115 | | $ | 37,117 | | $ | 13,249 | | $ | 8,538 | | $ | 3,682 | | $ | 354,701 |
| | | | | | | | | | | | | | | | | | | |
Non-Accretable Discount | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 309,506 | | $ | 10,663 | | $ | 7,135 | | $ | 22,337 | | $ | 18,113 | | $ | 367,754 |
Change in actual and expected cash flows | | | | (3,421) | | | (1,071) | | | - | | | 150 | | | (14) | | | (4,356) |
Transfers (to) from accretable yield | | | | (470) | | | 73 | | | 165 | | | (80) | | | 21 | | | (291) |
Balance at end of period | | | $ | 305,615 | | $ | 9,665 | | $ | 7,300 | | $ | 22,407 | | $ | 18,120 | | $ | 363,107 |
| | | | | | | | | | | | | | | | |
| | | | | | | | | Construction & | | | | | | | | | |
| | | | | | | | | Development | | | | | | | | | |
| | | Loans Secured | | | | | Secured by | | | | | | | | | |
| | | by 1-4 Family | | Commercial | | 1-4 Family | | | | | | | | | |
| | | Residential | | and Other | | Residential | | | | | | | | | |
| | | Properties | | Construction | | Properties | | Leasing | | Consumer | | Total |
Acquired Eurobank loans: | | | | | | | | | | | | | | | | | | | |
Accretable Yield | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 50,502 | | $ | 24,103 | | $ | 2,050 | | $ | - | | $ | - | | $ | 76,655 |
Accretion | | | | (2,196) | | | (4,400) | | | (43) | | | - | | | (62) | | | (6,701) |
Change in expected cash flows | | | | 702 | | | (709) | | | 32 | | | - | | | 70 | | | 95 |
Transfers from (to) non-accretable discount | | | | (3,169) | | | (2,519) | | | 155 | | | - | | | (8) | | | (5,541) |
Balance at end of period | | | $ | 45,839 | | $ | 16,475 | | $ | 2,194 | | $ | - | | $ | - | | $ | 64,508 |
| | | | | | | | | | | | | | | | | | | |
Non-Accretable Discount | | | | | | | | | | | | | | | | | | | |
Balance at beginning of period | | | $ | 6,973 | | $ | 805 | | $ | 156 | | $ | - | | $ | - | | $ | 7,934 |
Change in actual and expected cash flows | | | | (1,701) | | | 556 | | | 10 | | | - | | | - | | | (1,135) |
Transfers (to) from accretable yield | | | | 3,169 | | | 2,519 | | | (155) | | | - | | | 8 | | | 5,541 |
Balance at end of period | | | $ | 8,441 | | $ | 3,880 | | $ | 11 | | $ | - | | $ | 8 | | $ | 12,340 |
| | | | | | | | | | | | | | | | | | | |
11 |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | |
Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital |
|
In addition to disclosing required regulatory capital measures, we also report certain non-GAAP capital measures that management uses in assessing its capital adequacy. These non-GAAP measures include tangible common equity ("TCE") and TCE ratio. The table below provides the details of the calculation of our regulatory capital and non-GAAP capital measures. While our non-GAAP capital measures are widely used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies, they may not be comparable to similarly titled measures reported by other companies. |
| | | | | | | | | | | | | | | | |
| | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 |
(Dollars in thousands) (unaudited) | | | Q4 | | Q3 | | Q2 | | Q1 | | Q4 |
Stockholders' Equity to Non-GAAP Tangible Common Equity | | | | | | | | | | | | | | | | |
Total stockholders' equity | | | $ | 920,411 | | $ | 924,934 | | $ | 915,890 | | $ | 903,801 | | $ | 897,077 |
Less: Intangible assets | | | | (92,229) | | $ | (92,648) | | $ | (93,068) | | $ | (93,487) | | $ | (93,907) |
Noncumulative perpetual preferred stock | | | | (176,000) | | $ | (176,000) | | $ | (176,000) | | $ | (176,000) | | $ | (176,000) |
Noncumulative perpetual preferred stock issuance costs | | | | 10,130 | | $ | 10,130 | | $ | 10,130 | | $ | 10,130 | | $ | 10,130 |
Tangible common equity | | | $ | 662,312 | | $ | 666,416 | | $ | 656,952 | | $ | 644,444 | | $ | 637,300 |
| | | | | | | | | | | | | | | | |
Common stock outstanding at end of period | | | | 43,915 | | $ | 43,914 | | $ | 43,914 | | $ | 43,914 | | $ | 43,868 |
Tangible book value (Non-GAAP) | | | $ | 15.08 | | $ | 15.18 | | $ | 14.96 | | $ | 14.68 | | $ | 14.53 |
Total Assets to Tangible Assets | | | | | | | | | | | | | | | | |
Total assets | | | $ | 6,501,824 | | $ | 6,592,113 | | $ | 6,712,596 | | $ | 6,874,572 | | $ | 7,099,149 |
Less: Intangible assets | | | | (92,229) | | $ | (92,648) | | $ | (93,068) | | $ | (93,487) | | $ | (93,907) |
Tangible assets (Non-GAAP) | | | $ | 6,409,595 | | $ | 6,499,465 | | $ | 6,619,528 | | $ | 6,781,085 | | $ | 7,005,242 |
Non-GAAP TCE Ratio | | | | | | | | | | | | | | | | |
Tangible common equity | | | $ | 662,312 | | $ | 666,416 | | $ | 656,952 | | $ | 644,444 | | $ | 637,300 |
Tangible assets | | | | 6,409,595 | | $ | 6,499,465 | | $ | 6,619,528 | | $ | 6,781,085 | | $ | 7,005,242 |
TCE ratio | | | | 10.33% | | $ | 10.25% | | $ | 9.92% | | $ | 9.50% | | $ | 9.10% |
Average Equity to Non-GAAP Average Tangible Common Equity | | | | | | | | | | | | | | | | |
Average total stockholders' equity | | | $ | 919,697 | | $ | 919,171 | | $ | 908,394 | | $ | 899,858 | | $ | 905,646 |
Less: Average noncumulative perpetual preferred stock | | | | (176,000) | | $ | (176,000) | | $ | (176,000) | | $ | (176,000) | | $ | (176,000) |
Average noncumulative perpetual preferred stock issuance costs | | | | 10,130 | | $ | 10,130 | | $ | 10,130 | | $ | 10,130 | | $ | 10,130 |
Average total common stockholders' equity | | | $ | 753,827 | | $ | 753,301 | | $ | 742,524 | | $ | 733,988 | | $ | 739,776 |
Less: Average intangible assets | | | | (92,502) | | $ | (92,922) | | $ | (93,341) | | $ | (93,759) | | $ | (94,217) |
Average tangible common equity | | | $ | 661,325 | | $ | 660,379 | | $ | 649,183 | | $ | 640,229 | | $ | 645,559 |
Credit Quality Metrics to Non-GAAP Credit Quality Metrics excluding PREPA (Held-for-sale as of Q3 2016) | | | | | | | | | | | | | | | | |
Net Charge-offs | | | $ | 13,506 | | $ | 65,352 | | $ | 9,478 | | $ | 10,048 | | $ | 12,737 |
Less: PREPA charge-off | | | | - | | | (56,229) | | | - | | | - | | | - |
Net Charge-offs, excluding PREPA (Non-GAAP) | | | $ | 13,506 | | $ | 9,123 | | $ | 9,478 | | $ | 10,048 | | $ | 12,737 |
| | | | | | | | | | | | | | | | |
Average Loans Held For Investment | | | $ | 3,009,579 | | $ | 3,160,091 | | $ | 3,129,570 | | $ | 3,100,157 | | $ | 3,043,109 |
| | | | | | | | | | | | | | | | |
Charge-off rate, excluding PREPA (Non-GAAP) | | | | | | | 1.15% | | | 1.21% | | | 1.30% | | | 1.67% |
| | | | | | | | | | | | | | | | |
Nonperforming Loans | | | $ | 105,327 | | $ | 110,886 | | $ | 290,391 | | $ | 298,475 | | $ | 303,205 |
Less: PREPA | | | | - | | | - | | | (183,020) | | | (186,675) | | | (190,290) |
Nonperforming Loans, excluding PREPA (Non-GAAP) | | | $ | 105,327 | | $ | 110,886 | | $ | 107,371 | | $ | 111,800 | | $ | 112,915 |
| | | | | | | | | | | | | | | | |
Non-acquired loans held for investment, gross | | | $ | 3,046,270 | | $ | 3,011,799 | | $ | 3,196,067 | | $ | 3,116,690 | | $ | 3,111,590 |
Less: PREPA | | | | - | | | - | | | (183,020) | | | (186,675) | | | (190,290) |
Non-acquired loans held for investment, excluding PREPA (Non-GAAP) | | | $ | 3,046,270 | | $ | 3,011,799 | | $ | 3,013,047 | | $ | 2,930,015 | | $ | 2,921,300 |
| | | | | | | | | | | | | | | | |
Nonperforming loan rate, excluding PREPA (Non-GAAP) | | | | 3.46% | | | 3.68% | | | 3.56% | | | 3.82% | | | 3.87% |
| | | | | | | | | | | | | | | | |
12 |
OFG Bancorp (NYSE: OFG) | | | | | | | | | | | | | | | | | |
Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures (Continued) | |
| |
| | | BASEL III | |
| | | Standardized | |
| | | 2016 | | 2016 | | 2016 | | 2016 | | 2015 | |
(Dollars in thousands) (unaudited) | | | Q4 | | Q3 | | Q2 | | Q1 | | Q4 | |
Regulatory Capital Metrics | | | | | | | | | | | | | | | | | |
Common equity Tier 1 capital | | | $ | 627,732 | | | 612,792 | | | 596,080 | | | 585,144 | | | 594,482 | |
Tier 1 capital | | | | 819,661 | | | 801,882 | | | 788,349 | | | 776,180 | | | 782,912 | |
Total risk-based capital | (15) | | | 876,656 | | | 860,513 | | | 849,147 | | | 838,283 | | | 846,747 | |
Risk-weighted assets | | | | 4,467,556 | | | 4,593,340 | | | 4,716,534 | | | 4,744,449 | | | 4,896,539 | |
Regulatory Capital Ratios | | | | | | | | | | | | | | | | | |
Common equity Tier 1 capital ratio | (16) | | | 14.05% | | | 13.34% | | | 12.64% | | | 12.33% | | | 12.14% | |
Tier 1 risk-based capital ratio | (17) | | | 18.35% | | | 17.46% | | | 16.71% | | | 16.36% | | | 15.99% | |
Total risk-based capital ratio | (18) | | | 19.62% | | | 18.73% | | | 18.00% | | | 17.67% | | | 17.29% | |
Leverage ratio | (19) | | | 12.99% | | | 12.35% | | | 11.92% | | | 11.38% | | | 11.18% | |
| | | | | | | | | | | | | | | | | |
Common Equity Tier 1 Capital Ratio Under Basel III Standardized Approach | | | | | | | | | | | | | | | | | |
Total stockholders' equity | | | $ | 920,411 | | | 924,934 | | | 915,890 | | | 903,801 | | | 897,077 | |
Less: Noncumulative perpetual preferred stock | | | | (176,000) | | | (176,000) | | | (176,000) | | | (176,000) | | | (176,000) | |
Noncumulative perpetual preferred stock issuance costs | | | | 10,130 | | | 10,130 | | | 10,130 | | | 10,130 | | | 10,130 | |
Unrealized gains on available-for-sale securities, net of income tax | | | | (2,209) | | | (17,554) | | | (18,085) | | | (15,089) | | | (16,925) | |
Unrealized losses on cash flow hedges, net of income tax | | | | 612 | | | 1,710 | | | 2,281 | | | 2,805 | | | 2,927 | |
| | | | 752,944 | | | 743,220 | | | 734,216 | | | 725,647 | | | 717,209 | |
Less: Disallowed goodwill | | | | (86,069) | | | (86,069) | | | (86,069) | | | (86,069) | | | (86,069) | |
Disallowed other intangible assets, net | (20) | | | (2,255) | | | (2,408) | | | (2,561) | | | (2,715) | | | (1,912) | |
Disallowed deferred tax assets, net | (20) | | | (36,888) | | | (41,951) | | | (49,506) | | | (51,719) | | | (34,746) | |
Common equity Tier 1 capital | | | | 627,732 | | | 612,792 | | | 596,080 | | | 585,144 | | | 594,482 | |
Plus: Qualifying noncumulative perpetual preferred stock | | | | 176,000 | | | 176,000 | | | 176,000 | | | 176,000 | | | 176,000 | |
Qualifying noncumulative perpetual preferred stock issuance costs | | | | (10,130) | | | (10,130) | | | (10,130) | | | (10,130) | | | (10,130) | |
Subordinated capital notes | | | | 35,000 | | | 35,000 | | | 35,000 | | | 35,000 | | | 35,000 | |
Less: Disallowed deferred tax assets, net | | | | (8,941) | | | (11,780) | | | (8,601) | | | (9,834) | | | (12,440) | |
Tier 1 capital | | | | 819,661 | | | 801,882 | | | 788,349 | | | 776,180 | | | 782,912 | |
Plus tier 2 capital: Qualifying allowance for loan and lease losses | | | | 56,995 | | | 58,631 | | | 60,798 | | | 62,103 | | | 63,835 | |
Total risk-based capital | | | $ | 876,656 | | $ | 860,513 | | $ | 849,147 | | $ | 838,283 | | $ | 846,747 | |
| | | | | | | | | | | | | | | | | |
13 | |
OFG Bancorp (NYSE: OFG) | | | |
Table 10: Notes to Financial Summary, Selected Metrics, Loans, and Consolidated Financial Statements (Tables 1 - 9) |
| | | | | | | | | | | | |
(1) | We use the term "acquired loans" to refer to loans acquired from the BBVAPR acquisition (December 18, 2012) and loans acquired in the Eurobank FDIC-Assisted acquisition (April 30, 2010), recorded at fair value at acquisition. The majority of these loans acquired are subsequently accounted for based on estimated cash flows expected to be collected over the life of the loans (under the accounting standard known as ASC 310-30). Because the guidance takes into consideration future credit losses expected to be incurred over the life of the loans, there are no charge-offs or an allowance associated with this loans unless the estimated cash flows expected to be collected decrease subsequent to acquisition. In addition, these loans are not classified as delinquent or nonperforming even though the customer may be contractually past due because we expect that we will fully collect the carrying value of these loans. Acquired loans also include loans acquired in the BBVAPR acquisition that were accounted for under the provisions of ASC 310-20, which at the end of the reporting period still have unamortized premium or discount. The fair value of these loans already include a credit mark for losses estimated on these loans. The allowance for loan and lease losses for these loans considers such marks applied. The accounting and classification of these loans may significantly alter some of our reported credit quality metrics. We therefore supplement certain reported credit quality metrics with metrics adjusted to exclude the impact of these acquired loans. Loans acquired in the BBVAPR acquisition that were accounted for under the provisions of ASC 310-20, which had fully amortized their premium or discount recorded at the date of acquisition at the end of the reporting period, are removed from the acquired loans category. |
(2) | Total banking and wealth management revenues. |
(3) | Calculated based on net income (loss) available to common shareholders divided by average common shares outstanding for the period. |
(4) | Calculated based on net income (loss) available to common shareholders plus the preferred dividends on the convertible preferred stock, divided by total average common shares outstanding and equivalents for the period as if converted. |
(5) | Tangible book value per common share is a non-GAAP measure calculated based on tangible common equity divided by common shares outstanding. See "Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures" for additional information. |
(6) | Information includes all loans held for investment, including all acquired loans. Acquired loans, including those accounted for under ASC 310-30, are disclosed at carrying amount. |
(7) | Calculated based on annualized net interest income for the period divided by average interest-earning assets for the period. |
(8) | Calculated based on annualized income, net of tax, for the period divided by average total assets for the period. |
(9) | Calculated based on annualized income available to common shareholders for the period divided by average tangible common equity for the period. |
(10) | Calculated based on non-interest expense for the period divided by total net interest income and total banking and financial services revenues for the period. |
(11) | Calculated based on annualized net charge-offs for the period divided by average loans held for investment for the period. |
(12) | Non-GAAP ratios. See "Table 9: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures" for information on the calculation of each of these ratios. |
(13) | Production of new loans (excluding renewals). |
(14) | Loans accounted for under ASC 310-30 (loans acquired with deteriorated credit quality, including those by analogy), including Eurobank acquired loans, 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 analyses. Therefore, they are not included as non-performing loans. |
(15) | Total risk-based capital equals the sum of Tier 1 capital and Tier 2 capital. |
(16) | Common equity Tier 1 capital ratio is a regulatory capital measure calculated based on Common equity Tier 1 capital divided by risk-weighted assets. |
(17) | Tier 1 risk-based capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by risk-weighted assets. |
(18) | Total risk-based capital ratio is a regulatory capital measure calculated based on Total risk-based capital divided by risk-weighted assets. |
(19) | Leverage capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by average assets, after certain adjustments. |
(20) | Amounts based on transition provisions for regulatory capital deductions and adjustments of 60% for 2016 and 40% for 2015. |
(21) | During 4Q2016, the income tax expense increased as a result of year-end adjustments. |
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14 |
