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EXHIBIT 5(B)
SULLIVAN & CROMWELL
125 Broad Street
New York, New York 10004
January 29, 1997
BanPonce Corporation,
209 Munoz Rivera Avenue,
Hato Rey, Puerto Rico 00918.
BanPonce Financial Corp.,
521 Fellowship Road,
Mt. Laurel, New Jersey 08054.
BanPonce Trust I,
c/o BanPonce Financial Corp.,
521 Fellowship Road,
Mt. Laurel, New Jersey 08054.
BanPonce Trust II,
c/o BanPonce Financial Corp.,
521 Fellowship Road,
Mt. Laurel, New Jersey 08054.
Ladies and Gentlemen:
In connection with the registration under the Securities Act of 1933, as
amended (the "Act"), of (i) up to $150,000,000 aggregate liquidation amount of
capital securities representing beneficial ownership interests (the "Capital
Securities") in BanPonce Trust I and BanPonce Trust II (the "Trusts"), (ii) up
to $150,000,000 aggregate principal amount of junior subordinated deferrable
interest debentures (the "Debentures") to be issued by BanPonce Financial Corp.
(the "Corporation"), (iii) unconditional and
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BanPonce Corporation
BanPonce Financial Corp.
BanPonce Trust I
BanPonce Trust II -2-
irrevocable guarantees (the "Guarantees" and each a "Guarantee") of the
obligations of the Trusts under the Capital Securities, to be issued by the
Corporation, (iv) unconditional and irrevocable guarantees (the "Additional
Guarantees" and each an "Additional Guarantee") of the obligations of the
Corporation under the Guarantees, to be issued by BanPonce Corporation (the
"Guarantor") and (v) unconditional and irrevocable guarantees (the "Debenture
Guarantees" and each a "Debenture Guarantee") of the obligations of the
Corporation under the Debentures, to be issued by the Guarantor, in each case
to be offered from time to time at prices and on terms to be determined at the
time of sale, we, as your counsel, have examined such corporate records,
certificates and other documents, and such questions of law, as we have
considered necessary or appropriate for the purposes of this opinion.
Upon the basis of such examination, we advise you that, in our opinion,
when the Registration Statement has become effective under the Act, the
indenture (the "Indenture") relating to the Debentures and the Debenture
Guarantees has been duly authorized, executed and delivered, the terms of the
Debentures and the Debenture Guarantees and of their issuance and sale have
been duly established in conformity with the Indenture so as not to violate any
applicable law or result in a default under or breach of any agreement or
instrument binding upon the Corporation or the Guarantor and so as to comply
with any requirement or
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BanPonce Corporation
BanPonce Financial Corp.
BanPonce Trust I
BanPonce Trust II -3-
restriction imposed by any court or governmental body having jurisdiction over
the Corporation or the Guarantor, the Debentures have been duly executed and
authenticated and the Debenture Guarantees have been duly executed, each in
accordance with the Indenture, the Debentures have been issued and sold as
contemplated in the Registration Statement, the guarantee agreement (the
"Guarantee Agreement") relating to the Guarantee and Additional Guarantee has
been duly authorized, executed and delivered, the terms of the Guarantee and
the Additional Guarantee and of their issuance have been duly established in
conformity with the Guarantee Agreement so as not to violate any applicable
law or result in a default under or breach of any agreement or instrument
binding upon the Corporation or the Guarantor and so as to comply with any
requirement or restriction imposed by any court or governmental body having
jurisdiction over the Corporation or the Guarantor, and the Guarantees and
the Additional Guarantees have been duly authorized, executed and delivered
by the Corporation and the Guarantor, respectively, (i) each of the Debentures
and the Guarantees will constitute valid and legally binding obligations of
the Corporation, subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating
to or
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BanPonce Corporation
BanPonce Financial Corp.
BanPonce Trust I
BanPonce Trust II -4-
affecting creditors' rights and to general equity principles and (ii) each of
the Debenture Guarantees and the Additional Guarantees will constitute valid
and legally binding obligations of the Guarantor, enforceable against the
Guarantor in accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles.
The foregoing opinion is limited to the Federal laws of the United States,
the laws of the State of New York and the Commonwealth of Puerto Rico, and the
General Corporation Law of the State of Delaware, and we are expressing no
opinion as to the effect of the laws of any other jurisdiction. With respect
to all matters of the laws of the Commonwealth of Puerto Rico, we have relied
upon the opinion, dated of even date herewith, of Brunilda Santos de Alvarez,
Esq., Counsel of the Guarantor, and our opinion is subject to the same
assumptions, qualifications and limitations with respect to such matters as are
contained in such opinion of Ms. Santos de Alvarez.
Also, we have relied as to certain matters on information obtained from
public officials, officers of the
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BanPonce Corporation
BanPonce Financial Corp.
BanPonce Trust I
BanPonce Trust II -5-
Corporation and the Guarantor and other sources believed by us to be
responsible.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the references to us under the heading "Validity
of Securities" in the Prospectus and the Prospectus Supplement. In giving such
consent, we do not thereby admit that we are in the category of persons whose
consent is required under Section 7 of the Act.
Very truly yours,
/s/ SULLIVAN & CROMWELL