EXHIBIT 99.1
[1 FIRST BANCORP LOGO]
Annie Astor-Carbonell
Senior Executive Vice President
and Chief Financial Officer
(787) 729-8088
annie.astor@firstbankpr.com
FIRSTBANCORP REPORTS
RECORD EARNINGS
PER SHARE INCREASE OF 54%
San Juan, Puerto Rico, October 21, 2004 -- First BanCorp (NYSE:FBP),
the second largest Puerto Rico Financial Holding Company with diversified
banking operations in Puerto Rico, the US and British Virgin Islands, and the
state of Florida, reported today earnings for the quarter ended September 30,
2004.
Net income was $49,079,189 or $0.97 per common share basic and $0.94
per common share diluted, for the third quarter of 2004, as compared to earnings
of $31,684,402 or $0.62 per common share basic and $0.61 per common share
diluted for the third quarter of 2003. These results represent an increase in
diluted earnings per share of 54% for this quarter. Return on Assets (ROA) and
Return on Common Equity (ROCE) were 1.37%
First BanCorp reports record earnings
per share increase of 54% Page 2
and 25.88%, respectively for the quarter as compared to 1.14% and 20.67%,
respectively for the same quarter of 2003. Basic and diluted weighted average
common shares for the 2004 third quarter were 40,241,867 and 41,503,902,
respectively.
For the nine months period ended September 30, 2004, earnings were
$129,218,818 or $2.46 per common share basic and $2.39 per common share diluted,
as compared to $97,383,395 or $1.92 per common share basic and $1.89 per common
share diluted. Basic and diluted weighted average shares for the 2004
year-to-date period were 40,174,120 and 41,414,358, respectively.
Commenting on this quarter results, Mr. Angel Alvarez-Perez, Chairman,
President, and CEO of First BanCorp said, "Our earnings have grown significantly
as a result of a strong increase of $31.4 million in net interest income, when
compared to the same period in 2003. Both loans and investments have had healthy
growth, but it is particularly important to mention that at
First BanCorp reports record earnings
per share increase of 54% Page 3
the end of the previous quarter we were able to make significant longer term
investments, after we had stayed on the sidelines for a few months, awaiting the
opportunity to make these investments, which have now contributed significantly
to our bottom line."
Net interest income, the Corporation's main source of income, increased
by $31.4 million from $71.9 million during the third quarter of 2003 to $103.3
million during the third quarter of 2004. When compared to the immediately
preceding quarter, it also increased by $9.0 million. The increases in net
interest income reflect the additional investments which were made during second
quarter of 2004. Net interest margin on a tax equivalent basis was 3.53% for the
quarter ended September 2004, as compared to 2.93% for the quarter ended
September 2003 and 3.45% for the previous quarter ended June 2004. Such
fluctuations are mainly the result of the investment strategies
First BanCorp reports record earnings
per share increase of 54% Page 4
and abnormally high prepayment rates on the mortgage backed securities during
the prior year.
Other income amounted to $15.7 million for the third quarter of 2004,
as compared to $19.1 million for the third quarter of 2003. The decrease is due
to higher net gains on sale of investments and derivative gains during the prior
year period. These gains amounted to $1.1 million during the third quarter of
2004, versus $5.5 million during the third quarter of 2003.
Net charge offs were $9.6 million (0.47% of average loans) for the
third quarter of 2004, as compared to $10.1 million (0.63% of average loans)
during the third quarter of 2003, and $9.9 million (0.52% of average loans),
during the second quarter of 2004. The charge offs ratio is at the lowest level
of the last 10 years, due to the Corporation's effective credit risk management
infrastructure.
The efficiency ratio was 38.6%, 43.8%, and 42.2% for the three months
ended September 30, 2004, September 30, 2003,
First BanCorp reports record earnings
per share increase of 54% Page 5
and June 30, 2004 respectively, one of the best in the industry. An increase in
expenses of $6.1 million, as compared to same quarter in 2003, is mainly
attributable to personnel, occupancy, and promotion expenses related to First
Mortgage, which started operations late in the third quarter of 2003, and
general increases in salaries and promotion expenses related to Corporation's
businesses general growth.
When compared to the previous quarter of June 2004, other operating
expenses are in line with an increase of only $465,000.
Total assets were $15.2 billion as of September 30, 2004, as compared to
$12.1 billion as of September 30, 2003, and $12.7 billion as of December 31,
2003. Loans receivable increased by 27% to $8.5 billion, as compared to $6.7
billion as of September 30, 2003. The largest loan volume increases were
achieved in the commercial and residential real estate portfolios.
Non-performing loans as of September 30, 2004 were $88.7 million (1.04% of
total loans), as compared to $85.7 million
First BanCorp reports record earnings
per share increase of 54% Page 6
(1.28% of total loans) and $91.0 million (1.15% of total loans), as of September
30, 2003 and June 30, 2004, respectively. The slight increase in dollar amount,
when compared to the September 2003 figure, consists mostly of secured real
estate loans.
The allowance for loan losses to non-performing loans (reserve coverage)
was 154.7% as of September 30, 2004, compared to 143.6% as of September 30, 2003
and 146.9%, as of June 30, 2004. The improvement in the coverage ratio is
related to the stability during 2004 in the delinquencies and non-performing
loans.
With $15.2 billion in assets, First BanCorp is the second largest Financial
Holding Company in Puerto Rico. It is the parent company of FirstBank Puerto
Rico; a state chartered commercial bank in Puerto Rico and Virgin Islands and of
FirstBank Insurance Agency. Both First BanCorp and FirstBank Puerto Rico,
operate within US banking laws and regulations.
First BanCorp reports record earnings
per share increase of 54% Page 7
The Bank operates a total of 112 financial service facilities throughout Puerto
Rico and the US and British Virgin Islands, including the operations of its
subsidiaries. On October 1, 2004 the Bank opened a loan office in Coral Gables,
Florida. Among the subsidiaries is Money Express, a finance company, First
Leasing and Car Rental, a car and truck rental leasing company, and
FirstMortgage, a mortgage banking company. In the US and British Virgin Islands
the Bank operates FirstBank Insurance VI, an insurance agency, First Trade,
Inc., a foreign corporation management company, and First Express, a small loan
company.
The Corporation's common and preferred shares trade on the New York
Stock Exchange, under the symbols FBP, FBPPrA, FBPPrB, FBPPrC, FBPPrD and
FBPPrE.
This press release may contain certain "forward-looking statements"
concerning the Corporation's economic future performance. The words or phrases
"expect", "anticipate", "look forward", "should", and similar expressions are
meant to identify
First BanCorp reports record earnings
per share increase of 54% Page 8
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995.
The Corporation wishes to caution readers not to place undue reliance
on any such "forward-looking statements", which speak only as of the date made
and to advise readers that various factors, including regional and national
economic conditions, changes in interest rates, competitive and regulatory
factors and legislative changes, could affect the Corporation's financial
performance and could cause the Corporation's actual results for future period
to differ materially from those anticipated or projected.
The Corporation does not undertake, and specifically disclaims any
obligation, to update any "forward-looking statements" to reflect occurrences or
unanticipated events or circumstances after the date of such statements.
FIRST BANCORP
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION
(UNAUDITED)
DOLLARS IN THOUSANDS
SEPTEMBER 30, SEPTEMBER 30, DECEMBER 31,
2004 2003 2003
------------ ------------ ------------
ASSETS
Cash and due from banks $ 91,318 $ 75,145 $ 89,305
------------ ------------ ------------
Money market instruments 721,910 430,257 705,940
------------ ------------ ------------
Federal funds sold and securities purchased
under agreements to resell 302,000 159,000 265,000
------------ ------------ ------------
Investment securities available for sale, at market:
United States and Puerto Rico Government obligations 322,025 11,117 16,157
Mortgage backed securities 1,206,436 1,108,370 1,086,891
Corporate bonds 44,285 128,945 53,770
Equity investment 48,432 39,475 62,320
------------ ------------ ------------
Total investment securities available for sale 1,621,178 1,287,907 1,219,138
------------ ------------ ------------
Investment securities held to maturity, at cost:
United States and Puerto Rico Government obligations 2,035,947 1,111,491 1,119,775
Mortgage backed securities 1,625,199 2,055,882 1,970,855
Corporate bonds 64,743 39,847
------------ ------------ ------------
Total investment securities held to maturity 3,661,146 3,232,116 3,130,477
------------ ------------ ------------
Federal Home Loan Bank (FHLB) stock 68,650 42,595 45,650
------------ ------------ ------------
Loans receivable:
Commercial Loans 3,052,592 2,736,703 2,832,635
Finance Leases 200,589 155,143 161,283
Consumer Loans 1,302,714 1,237,350 1,171,590
Residential Loans 3,946,387 2,577,612 2,879,010
------------ ------------ ------------
Total loans receivable 8,502,282 6,706,808 7,044,518
Allowance for loan losses (137,253) (123,024) (126,378)
------------ ------------ ------------
Total loans, net 8,365,029 6,583,784 6,918,140
Other real estate owned 6,939 3,999 4,617
Premises and equipment, net 88,866 82,820 85,269
Accrued interest receivable 61,181 42,463 41,508
Other assets 189,444 148,686 162,866
------------ ------------ ------------
Total assets $ 15,177,661 $ 12,088,772 $ 12,667,910
============ ============ ============
LIABILITIES & STOCKHOLDERS' EQUITY
Liabilities:
Deposits $ 7,368,031 $ 6,512,449 $ 6,765,107
Federal funds purchased and securities sold
under agreements to repurchase 4,614,109 3,587,878 3,650,297
Advances from FHLB 1,373,000 742,000 913,000
Notes Payable & Subordinated Notes 236,372 82,818 82,818
Other Borrowings 231,500
Payable for unsettled investment trade 10,285
Accounts payable and other liabilities 160,910 109,863 167,119
------------ ------------ ------------
13,994,207 11,035,008 11,578,341
------------ ------------ ------------
Stockholders' equity:
Preferred Stock 550,100 550,100 550,100
------------ ------------ ------------
Common stock outstanding 40,286 40,011 40,027
Additional paid - in capital 3,210 269
Capital Reserve and Legal Surplus 243,106 219,345 243,107
Retained earnings 304,573 203,284 220,038
Accumulated other comprehensive income, net of tax 42,179 41,024 36,028
------------ ------------ ------------
1,183,454 1,053,764 1,089,569
------------ ------------ ------------
Total liabilities and stockholders' equity $ 15,177,661 $ 12,088,772 $ 12,667,910
============ ============ ============
BOOK VALUE PER COMMON SHARE $ 15.26 $ 12.59 $ 13.48
============ ============ ============
FIRST BANCORP
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
(UNAUDITED)
DOLLARS IN THOUSANDS
THREE MONTHS ENDED NINE MONTHS ENDED
---------------------------------------- ---------------------------
SEPTEMBER 30, SEPTEMBER 30, JUNE 30, SEPTEMBER 30, SEPTEMBER 30
2004 2003 2004 2004 2003
------------ ------------ ------------ ------------ ------------
INTEREST INCOME:
Loans $ 113,831 $ 98,762 $ 103,074 $ 316,954 $ 290,003
Investments 66,248 34,856 58,134 170,881 99,359
------------ ------------ ------------ ------------ ------------
Total interest income 180,079 133,618 161,208 487,835 389,362
------------ ------------ ------------ ------------ ------------
INTEREST EXPENSE:
Deposits 30,730 28,036 26,610 84,387 84,253
Borrowings 46,077 33,686 40,320 121,695 96,873
------------ ------------ ------------ ------------ ------------
Total interest expense 76,807 61,722 66,930 206,082 181,126
------------ ------------ ------------ ------------ ------------
Net interest income 103,272 71,896 94,278 281,753 208,236
------------ ------------ ------------ ------------ ------------
PROVISION FOR LOAN LOSSES 13,200 12,600 13,200 39,600 41,764
------------ ------------ ------------ ------------ ------------
Net interest income after provision
for loan losses 90,072 59,296 81,078 242,153 166,472
------------ ------------ ------------ ------------ ------------
OTHER INCOME:
Service charges on deposit accounts 2,705 2,202 2,742 8,231 7,147
Other fees on loans 4,384 5,282 4,218 14,547 15,283
Mortgage banking activities 1,328 432 217 3,090 2,374
Net gain on sale of investments 360 4,384 551 4,876 28,206
Derivatives gain (loss) 763 1,154 (961) (623) 1,039
Rental Income 814 579 702 2,133 1,609
Gain on sale of credit cards portfolio 297 5,533
Other operating income 5,367 5,103 5,884 15,583 12,646
------------ ------------ ------------ ------------ ------------
Total other income 15,721 19,136 13,650 53,370 68,304
------------ ------------ ------------ ------------ ------------
OTHER OPERATING EXPENSES:
Employees' compensation and benefits 21,432 18,195 21,513 62,932 54,719
Occupancy and equipment 10,224 9,042 9,447 29,055 26,757
Business promotion 4,355 2,691 4,588 12,411 8,114
Taxes, other than income taxes 2,283 1,920 1,951 6,182 5,428
Insurance and supervisory fees 995 726 1,010 3,081 2,476
Other 6,687 7,285 7,001 20,983 21,110
------------ ------------ ------------ ------------ ------------
Total other operating expenses 45,976 39,859 45,510 134,644 118,604
------------ ------------ ------------ ------------ ------------
INCOME BEFORE INCOME TAX 59,817 38,573 49,218 160,879 116,172
INCOME TAX PROVISION 10,738 6,889 9,283 31,660 18,789
------------ ------------ ------------ ------------ ------------
NET INCOME $ 49,079 $ 31,684 $ 39,935 $ 129,219 $ 97,383
============ ============ ============ ============ ============
NET INCOME APPLICABLE TO
COMMON STOCK $ 39,010 $ 24,933 $ 29,866 $ 99,012 $ 77,130
============ ============ ============ ============ ============
NET INCOME PER COMMON SHARE - BASIC $ 0.97 $ 0.62 $ 0.74 $ 2.46 $ 1.92
============ ============ ============ ============ ============
NET INCOME PER COMMON SHARE - DILUTED $ 0.94 $ 0.61 $ 0.72 $ 2.39 $ 1.89
============ ============ ============ ============ ============
DIVIDENDS DECLARED PER COMMON SHARE $ 0.12 $ 0.11 $ 0.12 $ 0.36 $ 0.33
============ ============ ============ ============ ============
FIRST BANCORP
SELECTED FINANCIAL DATA
(UNAUDITED)
DOLLARS IN THOUSANDS
September 30, September 30, December 31,
CREDIT QUALITY DATA AT: 2004 2003 2003
------------ ------------ ------------
Non-performing Assets $ 102,668 $ 99,558 $ 100,771
------------ ------------ ------------
Non-performing Loans 88,735 85,690 85,525
------------ ------------ ------------
Past Due Loans 21,980 19,785 23,493
------------ ------------ ------------
Allowance for Loan Losses 137,253 123,024 126,378
------------ ------------ ------------
Non-performing Assets to Total Assets 0.68% 0.82% 0.80%
------------ ------------ ------------
Non-performing Loans to Total Loans 1.04% 1.28% 1.21%
------------ ------------ ------------
Allowance to Non-Performing Loans 154.68% 143.57% 147.77%
------------ ------------ ------------
Three
Months
SELECTED PERFORMANCE RATIOS: Three Months Ended Ended Nine Months Ended
September 30, June 30, September 30,
2004 2003 2004 2004 2003
----------- ----------- ----------- ----------- -----------
Net Interest Yield (1) 3.53% 2.93% 3.45% 3.45% 3.21%
----------- ----------- ----------- ----------- -----------
Return on Assets 1.37% 1.14% 1.19% 1.30% 1.31%
----------- ----------- ----------- ----------- -----------
Return on Equity 17.03% 15.00% 14.27% 15.30% 15.54%
----------- ----------- ----------- ----------- -----------
Return on Common Equity 25.88% 20.67% 20.98% 22.93% 21.68%
----------- ----------- ----------- ----------- -----------
Net Write offs to Average Loans 0.47% 0.63% 0.52% 0.50% 0.67%
----------- ----------- ----------- ----------- -----------
Efficiency Ratio 38.64% 43.79% 42.17% 40.18% 42.89%
----------- ----------- ----------- ----------- -----------
AVERAGE BALANCES:
Assets $14,299,336 $11,093,766 $13,437,398 $13,299,543 $ 9,920,758
----------- ----------- ----------- ----------- -----------
Earnings Assets 13,936,724 10,679,453 13,065,222 12,885,744 9,562,127
----------- ----------- ----------- ----------- -----------
Loans 8,110,497 6,466,821 7,582,816 7,628,223 6,091,115
----------- ----------- ----------- ----------- -----------
Deposits 7,116,981 6,097,961 6,924,520 6,916,086 5,611,912
----------- ----------- ----------- ----------- -----------
Interest-bearing liabilities 12,403,584 9,597,063 11,607,155 11,447,208 8,495,419
----------- ----------- ----------- ----------- -----------
Stockholders Equity 1,152,992 845,051 1,119,628 1,125,803 835,518
----------- ----------- ----------- ----------- -----------
Common Stockholders Equity 602,892 482,490 569,528 575,703 474,323
----------- ----------- ----------- ----------- -----------
(1) On a taxable equivalent basis.