EXHIBIT 99
[ORIENTAL FINANCIAL GROUP LOGO]
FOR RELEASE: CONTACT:
Wednesday, July 21, 2004 Steven Anreder and Gary Fishman
Anreder & Company
Phone: (212) 532-3232
ORIENTAL FINANCIAL GROUP NET INCOME
INCREASES 24.0% IN FISCAL 2004 AND 27.1% IN THE FOURTH QUARTER
San Juan, Puerto Rico, (Wednesday, July 21, 2004) - Oriental Financial Group
Inc. (NYSE: OFG) announced record net income for the year ended June 30, 2004.
Fiscal 2004 net income increased 24.0% to $63.6 million, compared to $51.3
million last year, and earnings per diluted share increased 15.4% to $2.78,
compared to last year's $2.41 per share. Return on Equity (ROE) equaled 34.64%,
against 31.33% in Fiscal 2003, and Return on Assets (ROA) for the year
increased to 1.91%, compared to 1.88%. At year-end Fiscal 2004, stockholders'
equity amounted to $294.7 million, up 46.1%, from year-end Fiscal 2003, and per
share book value equaled $10.30, an increase of 18.9%, based on a greater
number of outstanding shares. Total financial assets managed and owned were
$6.5 billion, an increase of 13.6% from June 30, 2003.
In the three months ended June 30, 2004, net income increased 27.1% to a record
$18.1 million for the fiscal fourth quarter compared to $14.2 million in the
year-ago quarter. Earnings per diluted share increased 10.4% to $0.74, compared
to last year's $0.67. ROE improved to 32.33% compared to 32.06%, and ROA
equaled the year ago quarter's 1.99%.
Earnings per share for the fiscal year and fourth quarter was affected by more
average shares outstanding in both periods, the result of the Group's March
2004 secondary offering of 1,995,000 common shares, which raised $51.5 million,
and dividends paid on the preferred stock offering sold in September 2003,
which raised $33.1 million. Excluding the effect of the new shares and the new
dividend, earnings per share would have been higher by an additional $0.14 for
the year and by an additional $0.08 for the quarter, and would have resulted in
earnings per share growth of 21.2% for Fiscal 2004 and 22.4% for the fourth
quarter compared to the corresponding prior year periods.
PAGE 1 OF 10
"We are pleased to have exceeded our average annual earnings per share growth
targets despite more shares outstanding," said Jose E. Fernandez, Chairman,
President and CEO. "We took major steps forward in Fiscal 2004, expanding our
executive team, raising fresh growth capital, and strengthening our banking and
financial services franchise. We launched The Oriental Way program, to deliver
world-class products and services, targeting the personal and commercial needs
of the Island's professionals and owners of small and mid-sized businesses. The
results of these efforts have been most satisfactory."
"Our strong fourth quarter performance reflected continued growth in commercial
loans, the successful launch of both our consumer loan business and the
Oriental Wealth Management program, tight control over non-interest expenses,
and reduced net charge-offs and non-performing loans, which reflects the
quality of our loan portfolio," said Mr. Fernandez.
FISCAL 2004 ANALYSIS
In Fiscal 2004, net interest income after provision for loan losses increased
17.7% to $82.6 million, with interest income up 8.3% to $164.4 million and
interest expense declining 0.2% to $77.2 million. Results benefited from a
larger volume of interest earning assets (investment and loans), despite lower
average yields. Interest rate margin equaled 2.75% for Fiscal 2004. At June 30,
2004, interest earnings assets increased 21.3% to $3,590.2 million compared to
June 30, 2003, reflecting a 27.5% increase in investments to $2,846.8 million,
which were concentrated in AAA rated mortgage backed securities and Puerto Rico
government agencies obligations.
Production of commercial loans, virtually all secured by real estate, increased
46.3%, to $56.4 million compared to $38.5 million. The increase reflected the
Group's expansion of its commercial business in the second half with
professionals and small and mid-sized businesses, and participations in
commercial real estate loans. Consumer loan production declined $0.9 million,
to $5.8 million, as the Group held back marketing pending expansion of the
business in the fourth quarter. Residential mortgage production was 7.5% lower,
at $330.4 million compared to $357.0 million, primarily due to the Group's
decision to temporarily moderate home loan activity based on fourth quarter
market conditions, which also resulted in lower mortgage banking revenues.
Total loans outstanding at the end of the year amounted to $743.5 million,
compared to $728.5 million a year earlier. Approximately $228.4 million of
conforming residential mortgage loans were sold in the secondary market in
Fiscal 2004.
At June 30, 2004, interest-bearing liabilities increased 26.0% to $3,307.4
million compared to June 30, 2003, reflecting a 44.3% increase in borrowings to
$2,283.0 million and a 1.9% decline in deposits to $1,024.3 million. The
increase in borrowings was concentrated in larger average balances of
repurchase agreements, Federal Home Loan Bank advances and subordinated capital
notes. The decrease in deposits primarily reflects a decision to cut back on
certificates of deposit in favor of other lower-cost funding sources.
PAGE 2 OF 10
Total non-interest banking and financial services revenues increased 14.2%, to
$32.5 million compared to $28.5 million. Banking service revenues increased
20.1%, to $7.2 million compared to $6.0 million, reflecting increased fees on
deposit accounts, bank service charges, and commissions, and the success of the
Group's product and service marketing programs. Financial service revenues
(commissions and fees from broker, insurance and fiduciary activities)
increased 21.7%, to $17.6 million compared to $14.5 million, the result of
general improvement in equity markets, increased underwriting activities,
higher service fees in fiduciary activities, and income generated by Caribbean
Pension Consultants, which was acquired in January 2003. Income from mortgage
banking declined 3.8%, to $7.7 million compared to $8.0 million, and the net
gain on the sale of securities decreased 9.2%, to $13.4 million compared to
$14.8 million.
Non-interest expenses increased 10.8%, to $59.4 million compared to $53.7
million. However, the Group's efficiency ratio in Fiscal 2004 improved to
49.63%, compared to 51.35% a year earlier. With the launch of its growth
program, the Group incurred higher outlays for human resources, technology and
marketing, among others, during the first half of Fiscal 2004. Thereafter,
costs were realigned, with expenses trending lower in the second half.
Net loans charged-off to average loans outstanding in Fiscal 2004 declined to
0.28% compared to 0.33% a year earlier, and the provision for loan losses
totaled $4.6 million compared to $4.2 million. The allowance for loan losses to
total loans at June 30, 2004 was 1.01%, or $7.6 million, compared to 0.69%, or
$5.0 million, at June 30, 2003, reflecting higher loss reserve requirements
related to the expanded commercial and consumer loan business.
Total financial assets managed and owned at June 30, 2004 included a 22.5%
increase in total bank assets, to $3,725.7 million, as compared to June 30,
2003; a 9.2% increase in broker-dealer assets gathered, to $1,051.8 million;
and trust assets managed of $1,670.7 million, approximately equal to a year
earlier.
FISCAL 2004 FOURTH QUARTER ANALYSIS
Fourth quarter net interest income after provision for loan losses increased
28.3%, to $21.4 million compared to $16.7 million in the year-ago quarter,
primarily reflecting a 14.6% increase in interest income to $42.5 million and
interest expense of $19.9 million, compared to $19.0 million in the
corresponding year-ago quarter. Results benefited from an increase in interest
earning assets (investment and loans), partially offset by a reduction of 10
basis points in the interest rate margin.
Commercial loan production increased 95.5%, to $23.6 million compared to $12.1
million. Consumer loan production increased 17.7%, to $2.6 million compared to
$2.2 million, benefiting from the Group's re-entry into providing installment
loans, backed by a disciplined credit control process. Residential mortgage
loan production declined 35.9%, to $68.0 million compared to $106.0 million.
PAGE 3 OF 10
Total non-interest banking and financial services revenues declined 4.3%, to
$7.7 million compared to $8.0 million. Banking service revenues increased
20.2%, to $1.9 million compared to $1.6 million, and financial service revenues
grew 7.7%, to $4.4 million compared to $4.1 million. Income from mortgage
banking declined 42.8%, to $1.3 million from $2.3 million, and the net gain on
the sale of securities totaled $3.9 million, compared with $5.8 million a year
earlier.
Non-interest expenses declined 0.9% in the quarter, to $14.5 million compared
to $14.6 million, with the efficiency ratio improving to 47.70% compared to
55.22%.
Net loans charged-off to average loans outstanding declined to 0.14% compared
to 0.25% a year ago. The provision for loan losses amounted to $1.2 million,
compared to $1.4 million in the year ago quarter. Total non-performing assets
declined sequentially to $31.7 million, or 0.83% of total assets, compared with
$34.4 million and 0.99%, respectively, in the March 2004 quarter.
Non-performing commercial loans declined 39.3%, to $2.9 million as of June 30,
2004, from $4.8 million as of March 31, 2004, and non-performing residential
mortgage loans decreased 6.7%, to $20.6 million.
FISCAL 2005 GROWTH PLAN
Mr. Fernandez said key factors in the Group's growth plan for Fiscal 2005
include:
- The anticipated opening of two new branches in the San Juan
metro area, giving Oriental a total of 25 branches, and
remodeling two branches to incorporate the Group's new
format.
- Continued growth in commercial and consumer loans, and
banking and financial service revenue as the Group expands
its Preferred Plan banking and Oriental Wealth Management
financial planning programs.
- Renewed growth in mortgage production.
- Maintaining the Group's high credit standards as well as
strict cost controls.
Mr. Fernandez noted that Fiscal 2005 earnings per share growth is expected to
expand through the year as the Group puts to work the additional capital raised
in the March 2004 offering. He added that the Group's Fiscal 2005 asset and
liability management strategy anticipates a rise in interest rates for the
year. During Fiscal 2005, the Group's results also should benefit from the
expanded executive team assembled in Fiscal 2004.
PAGE 4 OF 10
ABOUT ORIENTAL FINANCIAL GROUP
Oriental Financial Group Inc. is a diversified financial holding company
operating under U.S. and Puerto Rico banking laws and regulations. It provides
comprehensive financial services to its clients throughout Puerto Rico and
offers third party pension plan administration in the continental U.S. and
Puerto Rico through a wholly owned subsidiary, Caribbean Pension Consultants,
Inc., which is headquartered in Boca Raton, Florida. The Group's core
businesses include a full range of mortgage, commercial and consumer banking
services offered through 23 financial centers in Puerto Rico, as well as
financial planning, trust, insurance, investment brokerage and investment
banking services. More information about the Group may be obtained at
www.OrientalOnline.com.
FORWARD-LOOKING STATEMENTS
This release may contain forward-looking statements that reflect management's
beliefs and expectations and are subject to risks and uncertainties inherent to
the Group's business, including, without limitation, the effect of economic and
market conditions, the level and volatility of interest rates, and other
considerations.
# # #
PAGE 5 OF 10
[ORIENTAL FINANCIAL GROUP LOGO] ORIENTAL FINANCIAL GROUP
FINANCIAL SUMMARY
(NYSE:OFG)
QUARTER PERIOD FISCAL YEAR ENDED
----------------------------------------- ------------------------------
30-JUN-04 30-JUN-03 % 31-MAR-04 30-JUN-04 30-JUN-03 %
--------- --------- ----- --------- --------- --------- ------
SUMMARY OF OPERATIONS (IN THOUSANDS,
EXCEPT PER SHARE DATA):
INTEREST INCOME:
Loans $ 12,558 $ 13,422 -6.4% $ 12,538 $ 52,130 $ 51,486 1.3%
Investment securities 29,930 23,638 26.6% 29,909 112,255 100,260 12.0%
--------- --------- ----- --------- --------- --------- ------
TOTAL INTEREST INCOME 42,488 37,060 14.6% 42,447 164,385 151,746 8.3%
--------- --------- ----- --------- --------- --------- ------
INTEREST EXPENSE:
Deposits 6,954 8,058 -13.7% 7,755 30,012 33,657 -10.8%
Securities sold under agreements
to repurchase 9,995 8,686 15.1% 9,083 36,018 33,834 6.5%
Other borrowed funds 2,927 2,209 32.5% 2,853 11,144 9,844 13.2%
--------- --------- ----- --------- --------- --------- ------
TOTAL INTEREST EXPENSE 19,876 18,953 4.9% 19,691 77,174 77,335 -0.2%
--------- --------- ----- --------- --------- --------- ------
NET INTEREST INCOME 22,612 18,107 24.9% 22,756 87,211 74,411 17.2%
Provision for loan losses (1,183) (1,400) -15.5% (1,050) (4,587) (4,190) 9.5%
--------- --------- ----- --------- --------- --------- ------
NET INTEREST INCOME AFTER PROVISION
FOR LOAN LOSSES 21,429 16,707 28.3% 21,706 82,624 70,221 17.7%
--------- --------- ----- --------- --------- --------- ------
NON-INTEREST INCOME:
Commissions and fees from broker,
insurance and fiduciary activities 4,402 4,088 7.7% 4,357 17,617 14,472 21.7%
Banking service revenues 1,940 1,614 20.2% 1,820 7,165 5,968 20.1%
Mortgage banking activities 1,319 2,306 -42.8% 1,946 7,719 8,026 -3.8%
--------- --------- ----- --------- --------- --------- ------
Total banking and financial services
revenues 7,661 8,008 -4.3% 8,123 32,501 28,466 14.2%
Net gain on sale of securities 3,905 5,823 -32.9% 3,327 13,435 14,794 -9.2%
Net gain (loss) on derivatives and
other activities 970 427 127.2% (251) 98 (4,221) -102.3%
--------- --------- ----- --------- --------- --------- ------
TOTAL NON-INTEREST INCOME 12,536 14,258 -12.1% 11,199 46,034 39,039 17.9%
--------- --------- ----- --------- --------- --------- ------
NON-INTEREST EXPENSES:
Compensation and employees' benefits 6,424 5,297 21.3% 6,381 24,579 20,563 19.5%
Occupancy and equipment 2,556 2,323 10.0% 2,465 9,639 9,079 6.2%
Advertising and business promotion 1,380 2,240 -38.4% 1,919 7,466 7,052 5.9%
Professional and service fees 1,174 1,669 -29.7% 1,382 5,631 6,467 -12.9%
Communication 463 464 -0.2% 463 1,849 1,671 10.7%
Loan servicing expenses 466 468 -0.4% 461 1,853 1,775 4.4%
Taxes, other than payroll and income taxes 435 393 10.7% 455 1,754 1,556 12.7%
Electronic banking charges 480 331 45.0% 418 1,679 1,244 35.0%
Printing, postage, stationery and supplies 262 274 -4.4% 270 1,121 1,038 8.0%
Insurance, including deposit insurance 200 194 3.1% 197 791 736 7.5%
Other 613 926 -33.8% 586 3,070 2,475 24.0%
--------- --------- ----- --------- --------- --------- ------
TOTAL NON-INTEREST EXPENSES 14,453 14,579 -0.9% 14,997 59,432 53,656 10.8%
--------- --------- ----- --------- --------- --------- ------
INCOME BEFORE INCOME TAXES 19,512 16,386 19.1% 17,908 69,226 55,604 24.5%
Income tax expense (1,434) (2,161) -33.6% (1,585) (5,577) (4,284) 30.2%
--------- --------- ----- --------- --------- --------- ------
NET INCOME 18,078 14,225 27.1% 16,323 63,649 51,320 24.0%
Less: Dividends on preferred stock (1,200) (596) 101.3% (1,200) (4,198) (2,387) 75.9%
--------- --------- ----- --------- --------- --------- ------
NET INCOME AVAILABLE TO COMMON SHAREHOLDERS $ 16,878 $ 13,629 23.8% $ 15,123 $ 59,451 $ 48,933 21.5%
========= ========= ===== ========= ========= ========= ======
PAGE 6 OF 10
[ORIENTAL FINANCIAL GROUP LOGO] ORIENTAL FINANCIAL GROUP
FINANCIAL SUMMARY
(NYSE:OFG)
QUARTER PERIOD FISCAL YEAR ENDED
----------------------------------------------- -------------------------------------
30-JUN-04 30-JUN-03 % 31-MAR-04 30-JUN-04 30-JUN-03 %
--------- --------- ------ ---------- ---------- ---------- -----
SUMMARY OF OPERATIONS
(IN THOUSANDS, EXCEPT
PER SHARE DATA):
EARNINGS PER SHARE (1)
Earning per common share (basic) $ 0.77 $ 0.71 8.5% $ 0.75 $ 2.92 $ 2.56 14.1%
------ ------ ------ ---------- ---------- ---------- -----
Earning per common share (diluted) $ 0.74 $ 0.67 10.4% $ 0.71 $ 2.78 $ 2.41 15.4%
------ ------ ------ ---------- ---------- ---------- -----
Dividends declared per common share $ 0.14 $ 0.13 7.7% $ 0.14 $ 0.55 $ 0.49 12.2%
------ ------ ------ ---------- ---------- ---------- -----
Average Shares Outstanding (1) 21,983 19,313 13.8% 20,289 20,359 19,136 6.4%
Average potential common
share-options (1) 861 1,181 -27.1% 983 989 1,200 -17.6%
------ ------ ------ ---------- ---------- ---------- -----
TOTAL AVERAGE SHARES OUTSTANDING
AND EQUIVALENTS (1) 22,844 20,494 11.5% 21,272 21,348 20,336 5.0%
------ ------ ------ ---------- ---------- ---------- -----
Common shares outstanding at
end of period (1) 21,922 22,011 19,425 13.3%
---------- ---------- ---------- -----
Book value per common share (1) $ 9.98 $ 10.30 $ 8.66 18.9%
---------- ---------- ---------- -----
PERFORMANCE RATIOS:
Return on assets 1.99% 1.99% 0.0% 1.93% 1.91% 1.88% 1.6%
------ ------ ------ ---------- ---------- ---------- -----
Return on common equity 32.33% 32.06% 0.8% 36.35% 34.64% 31.33% 10.6%
------ ------ ------ ---------- ---------- ---------- -----
Efficiency Ratio 47.70% 55.22% -13.6% 48.53% 49.63% 51.35% -3.3%
------ ------ ------ ---------- ---------- ---------- -----
Leverage capital ratio 11.58% 11.24% 8.19% 37.2%
---------- ---------- ---------- -----
Tier 1 risk-based capital 38.43% 37.91% 25.00% 51.6%
---------- ---------- ---------- -----
Total risk-based capital 39.08% 38.61% 24.48% 57.7%
---------- ---------- ---------- -----
SELECTED FINANCIAL DATA AT PERIOD-END
Trust Assets Managed $1,666,052 $1,670,651 $1,670,437 0.0%
Broker-Dealer Assets Gathered 1,096,906 1,051,812 962,919 9.2%
---------- ---------- ---------- -----
TOTAL ASSETS MANAGED 2,762,958 2,722,463 2,633,356 3.4%
Bank assets owned 3,466,215 3,725,695 3,040,551 22.5%
---------- ---------- ---------- -----
TOTAL FINANCIAL ASSETS MANAGED AND OWNED $6,229,173 $6,448,158 $5,673,907 13.6%
========== ========== ========== =====
(1) DATA ADJUSTED TO GIVE RETROACTIVE EFFECT TO THE 10% STOCK DIVIDEND
DECLARED ON THE GROUP'S COMMON STOCK ON NOVEMBER 20, 2003.
PAGE 7 OF 10
[ORIENTAL FINANCIAL GROUP LOGO] ORIENTAL FINANCIAL GROUP
FINANCIAL SUMMARY
(NYSE:OFG)
QUARTER PERIOD FISCAL YEAR ENDED
--------------------------------------- -----------------------------------
30-JUN-04 30-JUN-03 % 31-MAR-04 30-JUN-04 30-JUN-03 %
--------- --------- --- ----------- ----------- ----------- -----
SUMMARY OF OPERATIONS (IN THOUSANDS,
EXCEPT PER SHARE DATA):
SELECTED FINANCIAL DATA AT
PERIOD-END
INTEREST-EARNING ASSETS:
INVESTMENTS:
Short term investments 6,093 $ 7,747 $ 1,152 572.5%
Trading securities 2,820 574 1,037 -44.6%
Investment securities available-
for-sale, at fair value 1,381,415 1,527,407 2,207,604 -30.8%
Investment securities held-to-
maturity, at amortized cost 1,233,033 1,282,862 -- 100.0%
Federal Home Loan Bank
(FHLB) stock, at cost 22,537 28,160 $ 22,537 25.0%
----------- ----------- ----------- -----
TOTAL INVESTMENTS $ 2,645,898 $ 2,846,750 $ 2,232,330 27.5%
----------- ----------- ----------- -----
LOANS:
Residential mortgage loans $ 575,141 $ 589,328 $ 584,009 0.9%
Home equity loans and secured
personal loans 72,477 67,353 90,516 -25.6%
Commercial loans, mainly
secured by real estate 64,382 81,846 42,931 90.6%
Consumer loans 16,834 18,510 20,572 -10.0%
----------- ----------- ----------- -----
LOANS RECEIVABLE, GROSS 728,834 757,037 738,028 2.6%
Less: deferred loan fees, net (11,690) (11,842) (13,733) -13.8%
----------- ----------- ----------- -----
LOANS RECEIVABLE 717,144 745,195 724,295 2.9%
Allowance for loan losses (6,632) (7,553) (5,031) 50.1%
----------- ----------- ----------- -----
LOANS RECEIVABLE, NET 710,512 737,642 719,264 2.6%
Mortgage loans held for sale 7,600 5,814 9,198 -36.8%
----------- ----------- ----------- -----
TOTAL LOANS RECEIVABLE, NET $ 718,112 $ 743,456 $ 728,462 2.1%
----------- ----------- ----------- -----
TOTAL INTEREST-EARNING ASSETS $ 3,364,010 $ 3,590,206 $ 2,960,792 21.3%
----------- ----------- ----------- -----
INTEREST-BEARING LIABILITIES:
DEPOSITS:
Demand deposits $ 133,286 $ 126,296 $ 132,328 -4.6%
Savings accounts 90,613 88,463 92,210 -4.1%
Certificates of deposit 833,823 809,590 819,727 -1.2%
----------- ----------- ----------- -----
TOTAL DEPOSITS 1,057,722 1,024,349 1,044,265 -1.9%
----------- ----------- ----------- -----
BORROWINGS:
Securities sold under
agreements to repurchase 1,648,339 1,895,865 1,400,598 35.4%
Advances from FHLB 310,800 300,000 130,000 130.8%
Subordinated capital notes 72,166 72,166 36,083 100.0%
Term notes 15,000 15,000 15,000 0.0%
----------- ----------- ----------- -----
TOTAL BORROWINGS 2,046,305 2,283,031 1,581,681 44.3%
----------- ----------- ----------- -----
TOTAL INTEREST-BEARING
LIABILITIES $ 3,104,027 $ 3,307,380 $ 2,625,946 26.0%
----------- ----------- ----------- -----
Preferred Equity 68,000 68,000 33,500 103.0%
Common Equity 218,676 226,667 168,180 34.8%
----------- ----------- ----------- -----
STOCKHOLDERS' EQUITY $ 286,676 $ 294,667 $ 201,680 46.1%
----------- ----------- ----------- -----
PAGE 8 OF 10
[ORIENTAL FINANCIAL GROUP LOGO] ORIENTAL FINANCIAL GROUP
FINANCIAL SUMMARY
(NYSE:OFG)
QUARTER PERIOD FISCAL YEAR ENDED
----------------------------------------------- --------------------------------
30-JUN-04 30-JUN-03 % 31-MAR-04 30-JUN-04 30-JUN-03 %
--------- --------- -------- --------- --------- --------- -----
SUMMARY OF OPERATIONS
(IN THOUSANDS,
EXCEPT PER SHARE
DATA):
NUMBER OF FINANCIAL CENTERS 23 23 23
------ -------- --------
CREDIT DATA
Net loans charged-off $ 262 $ 444 -41.0% $ 438 $ 2,065 $ 2,198 -6.1%
-------- -------- -------- ------- -------- -------- -----
Net charge-offs to
average loans outstanding 0.14% 0.25% -44.0% 0.24% 0.28% 0.33% -15.2%
-------- -------- -------- ------- -------- -------- -----
Allowance for loan losses $ 6,632 $ 7,553 $ 5,031 50.1%
------- -------- -------- -----
Allowance coverage ratios:
Allowance for loan losses to
total loans 0.92% 1.01% 0.69% 46.4%
------- -------- -------- -----
Allowance for loan losses to
non-performing loans 19.55% 24.53% 17.42% 40.8%
------- -------- -------- -----
Allowance for loan losses to
non-real estate
non-performing loans 127.78% 230.34% 217.32% 6.0%
------- -------- -------- -----
Non-performing assets summary:
Residential mortgage loans $22,131 $ 20,648 $ 19,786 4.4%
Home equity loans 6,607 6,861 6,781 1.2%
Commercial 4,870 2,954 1,817 62.6%
Consumer 320 325 498 -34.7%
------- -------- -------- -----
Non-performing loans $33,928 $ 30,788 $ 28,882 6.6%
Foreclosed properties 447 888 536 65.7%
-------- -------- -------- -----
Non-performing assets $ 34,375 $ 31,676 $ 29,418 7.7%
-------- -------- -------- -----
Non-performing loans to total loans 4.68% 4.10% 3.94% 4.1%
------ -------- -------- -----
Non-performing assets to total assets 0.99% 0.83% 0.95% -12.6%
------ -------- -------- -----
Loan Production Summary:
Residential mortgage loans $ 67,985 $106,047 -35.9% $76,853 $6330,395 $357,027 -7.5%
Home equity loans and secured
personal loans 44 1,417 -96.9% 16 1,068 15,018 -92.9%
Commercial 23,606 12,073 95.5% 14,323 56,357 38,522 46.3%
Consumer 2,570 2,184 17.7% 972 5,800 6,729 -13.8%
-------- -------- -------- ------- -------- -------- -----
Total loan production $ 94,205 $121,721 -22.6% $92,164 $393,620 $417,296 -5.7%
-------- -------- -------- ------- -------- -------- -----
PAGE 9 OF 10
[ORIENTAL FINANCIAL GROUP LOGO] ORIENTAL FINANCIAL GROUP
FINANCIAL SUMMARY
(NYSE:OFG)
QUARTER PERIOD FISCAL YEAR ENDED
------------------------------------------------ ---------------------------------
30-JUN-04 30-JUN-03 % 31-MAR-04 30-JUN-04 30-JUN-03 %
--------- --------- ----- --------- --------- --------- -----
SUMMARY OF OPERATIONS
(IN THOUSANDS, EXCEPT
PER SHARE DATA):
TAX EQUIVALENT SPREAD
Interest-earning assets 4.94% 5.58% -11.5% 5.24% 5.19% 6.09% -14.8%
Tax equivalent adjustment 1.12% 2.14% -47.7% 1.87% 1.11% 2.12% -47.6%
---- ---- ----- ---- ---- ---- -----
INTEREST-EARNING ASSETS -- TAX EQUIVALENT 6.06% 7.72% -21.5% 7.11% 6.30% 8.21% -23.3%
Interest-bearing liabilities 2.46% 2.92% -15.8% 2.56% 2.55% 3.18% -19.8%
---- ---- ----- ---- ---- ---- -----
Tax equivalent interest rate spread 3.60% 4.80% -25.0% 4.55% 3.75% 5.03% -25.4%
---- ---- ----- ---- ---- ---- -----
Tax equivalent interest rate margin 3.75% 4.87% -23.0% 4.68% 3.86% 5.11% -24.5%
---- ---- ----- ---- ---- ---- -----
NORMAL SPREAD
Investments 4.45% 4.89% -9.0% 4.78% 4.62% 5.49% -15.8%
Loans 6.65% 7.42% -10.4% 6.81% 7.07% 7.70% -8.2%
---- ---- ----- ---- ---- ---- -----
Interest-earning assets 4.94% 5.58% -11.5% 5.24% 5.19% 6.09% -14.8%
---- ---- ----- ---- ---- ---- -----
Deposits 2.62% 2.98% -12.1% 2.91% 2.87% 3.30% -13.0%
Borrowings 2.38% 2.88% -17.4% 2.38% 2.38% 3.10% -23.2%
---- ---- ----- ---- ---- ---- -----
Interest-bearing liabilities 2.46% 2.92% -15.8% 2.56% 2.55% 3.18% -19.9%
---- ---- ----- ---- ---- ---- -----
Interest rate spread 2.48% 2.66% -6.8% 2.68% 2.64% 2.90% -9.0%
---- ---- ----- ---- ---- ---- -----
Interest rate margin 2.63% 2.73% -3.7% 2.81% 2.75% 2.99% -8.0%
---- ---- ----- ---- ---- ---- -----
PAGE 10 OF 10