Attached files
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| 8-K - 8-K - POPULAR, INC. | d807875d8k.htm |
 Investor
Presentation Third Quarter 2014
Exhibit 99.1 |
 Forward Looking
Statements 1
The information contained in this presentation includes forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. These
forward-looking statements are based on management’s current expectations and
involve risks and uncertainties that may cause the Company's actual results to differ
materially from any future results expressed or implied by such forward-looking
statements. Factors that may 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) the fiscal and monetary policies of the federal government and its agencies; (iv)
changes in federal bank regulatory and supervisory policies, including required levels of
capital; (v) the relative strength or weakness of the consumer and commercial credit
sectors and of the real estate markets in Puerto Rico and the other markets in which
borrowers are located; (vi) the performance of the stock and bond markets; (vii)
competition in the financial services industry; (viii) possible legislative, tax or regulatory changes; (ix) the
impact of the Dodd-Frank Act on our businesses, business practice and cost of operations;
and (x) additional Federal Deposit Insurance Corporation assessments. Other than to the
extent required by applicable law, the Company undertakes no obligation to
publicly update or revise any forward-looking statement. Please refer to our Annual
Report on Form 10-K for the year ended December 31, 2013 and other SEC reports for a discussion of
those factors that could impact our future results. The financial information included in this
presentation for the quarter ended September 30, 2014 is based on preliminary unaudited
data and is subject to change. |
 Q3 2014
Highlights •
NPLs decreased by $18 million QoQ; ratio at 3.2%
•
NPL inflows, excluding consumer loans, down $24 million QoQ
•
NCOs of 0.83%
3
compared to 0.94% last quarter; decrease of $6 million
•
Reported adjusted net income of $91 million¹
•
Strong margins: Popular, Inc. 4.64%²
adjusted; BPPR 5.25%
Credit
(excluding
covered loans)
BPNA
Restructuring
Earnings
•
Completed TARP repayment on July 2, 2014 without raising additional equity
•
Robust
capital;
Tier
1
Common
Equity
ratio
of
14.8%
4
2
1
GAAP net income of $62.6 million. See appendix for reconciliation to GAAP.
²
Excludes
impact
of
$21
million
pertaining
to
US
repos
refinancing. US
GAAP
net
interest
margin
was
4.36%.
See
appendix
for
reconciliation
to
GAAP.
3
Excludes net write-downs related to BPNA’s legacy and classified assets
sales. 4
Capital ratios for the current quarter are estimated.
Capital
•
Strategic focus in US going forward on NY metro and South Florida regions
•
Illinois and Central Florida transactions closed in Q3 2014; California on pace to
close in Q4 2014
•
US operational restructuring initiative on track; expected completion first half of
2015 |
 Financial
Summary
(non-GAAP)¹
3
____________________
¹
Unaudited. See Appendix for reconciliation to GAAP.
($ in thousands)
Q3 14
Q2 14
Variance
Net interest income
347,084
$
354,687
$
(7,603)
$
FDIC loss share expense
(19,910)
(55,261)
35,351
Other non-interest income
129,194
118,050
11,144
Gross revenues
456,368
417,476
38,892
Provision for loan losses – non-covered loans
56,216
50,074
6,142
Provision for loan losses – covered loans
12,463
11,604
859
Total provision for loan losses
68,679
61,678
7,001
Net revenues
387,689
355,798
31,891
Personnel costs
104,542
99,100
5,442
OREO expenses
19,745
3,410
16,335
Other operating expenses
178,063
168,355
9,708
Total operating expenses
302,350
270,865
31,485
Income from continuing operations before income tax
85,339
84,933
406
Income tax expense
3,610
10,400
(6,790)
Income from continuing operations
81,729
$
74,533
$
7,196
$
Income from discontinued operations, net of tax
8,809
$
11,634
$
(2,825)
$
Net income
90,538
$
86,167
$
4,371
$ |
 BPNA
Restructuring-Operational Reorganization 4
•
Strategic focus going forward on NY metro and South Florida regions
•
Illinois and Central Florida transactions closed in Q3 2014 for $26 million net gain
•
California on pace to close in Q4 2014
•
US operational restructuring initiative progress on track with expected completion
first half of 2015
Annualized cost savings of $40 million beginning in Q2 2015
Operational
Reorganization
Balance Sheet
Management
•
$221 million book value of legacy and classified assets at BPNA contracted to sell for
a net loss of $12 million
US region ended Q3 2014 with total NPLs of $30 million or less than 1% of
loans
•
$638 million in high cost repo funding refinanced in Q3 2014; blended cost over 4%
Total refinancing penalty of $40 million, split between Q3 and Q4 2014
Lower risk profile and smaller balance sheet to yield additional excess capital |
 Capital
5
*Averages
for
30
bank
holding
Companies
with
$50
billion
or
more
of
total
consolidated
assets,
consisting
of
19
firms included in Comprehensive Capital Analysis and Review (CCAR) and 11 firms
included in Capital Plan Review (CapPR). Source SNL Financial & FactSet. •
Tier
1
Common
Equity
capital
ratio
of
14.8%
exceeds
current
CCAR
5%
minimum
•
We
expect
to
remain
“well-capitalized”
under
Basel
III
rules
issued
by
the
Federal
Reserve
Capital
Ratios
1
%
14.8
16.9
18.2
11.2
10.7
12.4
14.6
8.8
Tier 1 Common
Tier 1 Capital
Total Capital
Tangible Common
Equity
BPOP Q3 2014
CCAR & CapPR Q2 2014 *
1
Capital ratios for the current quarter are estimated |
 Non-Performing Assets ($MM)
Non-Performing Assets
6
________________________________
NPLs metrics exclude loans held-for-sale and covered loans.
Credit quality remained stable
Non-Performing Loans ($MM)
956
1,142
852
866
1,026
1,101
1,293
1,500
2,084
2,245
2,402
2,448
2,539
2,623
2,489
2,314
2,277
2,254
2,365
2,311
2,178
2,120
2,002
1,419
992
944
932
956
943
2.4%
1.9%
2.1%
2.5%
2.7%
3.3%
4.0%
5.7%
6.3%
6.9%
7.2%
6.0%
6.4%
6.4%
6.0%
5.8%
5.9%
6.3%
6.2%
5.9%
5.8%
5.5%
3.8%
2.7%
2.6%
2.6%
2.6%
2.6%
2.8%
Q3 07
Q4 07
Q1 08
Q2 08
Q3 08
Q4 08
Q1 09
Q2 09
Q3 09
Q4 09
Q1 10
Q2 10
Q3 10
Q4 10
Q1 11
Q2 11
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
NPLs
OREO
NPL HFS
NPAs/Total Assets
•
NPAs, including covered loans, decreased by $12 million QoQ
•
NPLs, excluding covered loans, down $18 million QoQ
BPPR NPLs increased $18 million
-
Mortgage NPLs increased by $21 million
635
1,008
771
781
923
1,028
1,203
1,404
1,978
2,116
2,276
2,313
2,330
2,344
1,572
1,614
1,625
1,732
1,738
1,682
1,563
1,550
1,425
1,051
614
618
598
640
622
3.1%
2.8%
2.9%
3.5%
3.9%
4.7%
5.6%
8.0%
8.7%
9.6%
10.0%
10.4%
10.6%
7.6%
7.9%
7.9%
8.4%
8.4%
8.2%
7.6%
7.5%
6.8%
4.9%
2.9%
2.9%
2.8%
2.9%
3.3%
3.2%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
Q3 07
Q4 07
Q1 08
Q2 08
Q3 08
Q4 08
Q1 09
Q2 09
Q3 09
Q4 09
Q1 10
Q2 10
Q3 10
Q4 10
Q1 11
Q2 11
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
Mortgage
Commercial & Construction
Other
NPL/Loans (HIP)
Non-covered NPLs decreased $18 million
NPL HFS increased $15 million, related to US legacy and classified assets sales
OREOs decreased by $9 million
US operations NPLs declined $36 million QoQ
-
Mortgage and consumer NPLs down $12 million and $5 million, respectively,
mainly related to loans transferred to HFS
-
Commercial NPLs down $17 million, primarily loan resolutions |
 Mortgage NPL
Inflows ($MM) Total NPL Inflows ($MM)
NPL Inflows
•
Total NPL inflows down by $24 million, or 16% QoQ
Excludes consumer loans
7
NPL inflows continued a generally stable to improving trend
77
76
48
45
42
26
22
22
22
10
19
11
7
222
101
93
65
100
43
48
59
42
32
94
31
23
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
US Inflows
PR Inflows
10
8
6
6
10
8
5
7
5
6
4
5
3
175
232
187
166
157
167
110
99
94
94
89
105
95
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
US Inflows
PR Inflows
87
84
55
51
52
34
26
29
27
16
23
16
9
397
333
279
231
257
210
158
158
136
126
183
136
119
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
US Inflows
PR Inflows
________________________________
Metrics exclude covered loans. Differences due to rounding.
PR commercial inflows down $8 million, or 25%
PR mortgage NPL inflows down by $10 million,
or 9%
US total NPL inflows decreased by $6 million, or 40%,
mainly driven by commercial inflows
Commercial, Construction & Legacy NPL Inflows ($MM)
|
 ALLL ($MM),
ALLL-to-NCO and ALLL-to-NPL Ratios NCO ($MM) and NCO-to-Loan
Ratio Provision ($MM) and Provision-to-NCO Ratio
Asset Quality
8
________________________________
Metrics exclude covered loans. Differences due to rounding.
135
126
108
98
96
101
81
79
58
35
43
46
40
163
200
32
2.64%
0.83%
1.49%
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
NCO
Bulk Sale Charge-offs
NCO%
Bulk Sale NCO%
151
124
83
82
84
86
58
55
55
48
47
50
56
149
169
12
111%
139%
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
PLL
Bulk Sale PLL
PLL/NCO
Bulk Sale PLL/NCO
693
690
665
649
636
622
584
529
526
538
543
526
522
128%
322%
40%
84%
Q3 11
Q4 11
Q1 12
Q2 12
Q3 12
Q4 12
Q1 13
Q2 13
Q3 13
Q4 13
Q1 14
Q2 14
Q3 14
ALLL
ALLL/NCO
ALLL/NPL
US legacy and classified assets related write-downs
amounted to $32 million
Provision increase of $18 million QoQ, includes $12 million
impact related loans transferred to HFS. Excluding this
impact, provision amounts to $56 million.
NCOs declined $6 million QoQ (excluding write-downs)
NCO ratio of 0.83% vs. 0.94% in Q2 2014
Provision to NCO of 139% (excluding write-downs impact),
compared to 108% in Q2 2014
ALLL decreased by $5 million QoQ; ALLL to loans at
2.69% vs. 2.68% in Q2 2014
$28 million reduction in the US; $20 million related to
loans transferred to HFS
$23 million increase in BPPR mainly due to qualitative factors
adjustments, reflective of challenging economic conditions
ALLL to NPL coverage ratio stable at 84% in Q3 2014 vs. 82%
in Q2 2014 |
 PR Public Sector
Exposure •
Loans to the Government of Puerto
Rico and Public Corporations are either
collateralized loans or obligations that
have a specific source of income or
revenues identified for their
repayment.
9
•
Loans to various municipalities are
backed by unlimited taxing power or
real and personal property taxes
collected within such municipalities.
Our current direct exposure to the PR government, instrumentalities, and municipalities is $823
million, of which approximately $727 million is outstanding, up $18 million from Q2
2014. PR Central Government & Public Corporations
Municipalities
•
Indirect exposure includes loans or
instruments that are payable by non-
governmental entities and have a
government guarantee to cover any
shortfall in collateral in the event of
borrower default. Majority are single-
family mortgage related.
Indirect Exposure
($ in millions)
Loans
Securities
Total
Central Government ¹
-
$
74
$
74
$
Public Corporations
PRASA
100
1
101
PREPA
75
-
75
PRHTA
-
-
-
OTHER
8
-
8
Total Central Govt & Public Corp.
183
75
258
as % of Tier 1 Capital
6.8%
Municipalities
409
60
469
Direct Government Exposure
592
$
135
$
727
$
Indirect Exposure
313
$
49
$
362
$
_________________________________
¹
Includes government sponsored banks and COFINA. |
 Driving
Shareholder Value Robust capital with Tier 1 Common Equity of 14.8%
TARP repayment and BPNA transactions move us toward a more active capital
management process
10
Unique franchise in PR provides strong, stable revenue-generating capacity
Continued stability in Popular’s credit metrics
EVTC ownership, BHD stake and restructured US operations
Capital
Additional
Value
Earnings |
 Investor
Presentation Third Quarter 2014
APPENDIX |
 Selected
equity investments (first two under “corporate”
segment and third and fourth under PR):
12
Who We Are –
Popular, Inc.
Franchise
•
Financial services company
•
Headquartered in San Juan, Puerto Rico
•
$34 billion in assets (among top 40 bank holding
company in the U.S.)
•
$22 billion in total loans
•
$24 billion in total deposits
•
245 banking branches serving customers in Puerto Rico,
New York, New Jersey, California, Florida, and U.S. and
British Virgin Islands
•
NASDAQ ticker symbol: BPOP
•
Market Cap: $3.05 billion
_____________________________________
Note: Information as of September 30, 2014
*Doing business as Popular Community Bank.
Summary Corporate Structure
Assets = $34.1 bn
Popular Auto,
Inc.
Banco
Popular
de Puerto Rico
Popular
Securities,
Inc.
Assets = $26.8 bn
Assets = $7.1bn
Banco Popular
North America*
Puerto Rico operations
Popular
Insurance,
Inc.
Popular North
America, Inc.
U.S. banking operations
Transaction processing,
business processes
outsourcing
14.8% stake
Dominican Republic
bank
15.82% stake
2013 approximate
net income $111
million
PRLP 2011 Holdings, LLC
24.9% stake
PR Asset Portfolio 2013-1
International, LLC
24.9% stake
Adjusted EBITDA of
$183.3 million for the
twelve months ended June
30, 2014
Construction and
commercial loans vehicle
Construction, commercial
loans and OREOs vehicle |
 Market
Leadership in Puerto Rico 38%
37%
35%
42%
40%
39%
39%
40%
24%
23%
22%
33%
34%
35%
36%
37%
2007
2008
2009
2010
2011
2012
2013
Q2 2014
Total Deposits (net of brokered)
Total Loans
Category
Market
position
Market
share
Total Deposits (Net of brokered)*
1
40%
Total Loans*
1
37%
Commercial & Construction Loans*
1
38%
Credit
Cards¹
1
52%
Mortgage Loan
Production¹
1
32%
Personal Loans*
1
31%
Auto Loans/Leases
3
17%
Assets Under Management
2
16%
Q2 2014
Source: Puerto Rico Office of the Commissioner of Financial Institutions, COSSEC, and 10K
Reports.*Information included pertains to PR Commercial Banks and Credit Unions.
¹
Mortgage loan production data is not publicly available; figures presented for BPPR and
competitors were provided internally as well as credit card information for certain competitors.
Popular’s Market Share Trend
Puerto Rico Market Share by Category
13 |
 14
GAAP Reconciliation Q3 2014
_____________________________________
* Unaudited.
¹
Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that
are covered under FDIC loss sharing agreements. ²
Total
basic
and
diluted
EPS,
including
discontinued
operations,
was
$0.60.
³
Excludes the impact of $21 million pertaining to US repos refinancing. US GAAP net interest
margin was 4.36%. (In thousands)
Actual
Results
BPNA (US GAAP)
Reorganization
Income Tax
Adjustments
Indemnification
Asset
Adjustment
Adjusted
Results
(Non-GAAP)
Net interest income (expense)
$ 326,421
$ (20,663)
$
-
$
- $ 347,084
Provision
for
loan
losses
–
non-covered
loans
68,166
11,950
-
-
56,216
Provision
for
loan
losses
–
covered
loans ¹
12,463
-
-
-
12,463
Net interest income (expense) after provision for loan losses
245,792
(32,613)
-
-
278,405
FDIC loss share expense
(4,864)
-
-
15,046
(19,910)
Other non-interest income
129,194
-
-
-
129,194
Restructuring costs
8,290
8,290
-
-
-
Other operating expenses
302,350
-
-
-
302,350
Income (loss) from continuing operations before income tax
59,482
(40,903)
-
15,046
85,339
Income tax expense
26,667
-
20,048
3,009
3,610
Income (loss) from continuing operations
$ 32,815
$ (40,903)
$ (20,048)
$ 12,037
$ 81,729
Income (loss) from discontinued operations, net of tax
$ 29,758
$ 20,949
$
- $ 8,809
Net income (loss)
$ 62,573
$ (19,954)
$ (20,048)
$ 12,037
$ 90,538
Basic and diluted EPS from continuing operations
0.31
$
²
Net interest margin
4.64%
³
Tangible common book value per common share
36.24
$
Market value per common share
29.44
$
Q3 2014 *
$
- |
 15
GAAP Reconciliation Q2 2014
_____________________________________
* Unaudited.
¹
Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that
are covered under FDIC loss sharing agreements. ²
Total
basic
and
diluted
EPS,
including
discontinued
operations,
was
($4.98).
³
Excludes the impact of $414.1 million TARP discount amortization. US GAAP net interest margin
was (0.77%). (In thousands)
Actual
Results
(US GAAP)
TARP discount
amortization
adjustments
BPNA
Reorganization
Adjusted
Results
(Non-GAAP)
Net interest (expense) income
$ (59,381)
$ (414,068)
$
- $ 354,687
Provision
for
loan
losses
–
non-covered
loans
50,074
-
-
50,074
Provision
for
loan
losses
–
covered
loans
¹
11,604
-
-
11,604
Net interest (expense) income after provision for loan losses
(121,059)
(414,068)
-
293,009
FDIC loss share expense
(55,261)
-
-
(55,261)
Other non-interest income
118,050
-
-
118,050
Restructuring costs
4,574
-
4,574
-
Other operating expenses
270,865
-
-
270,865
(Loss) income from continuing operations before income tax
(333,709)
(414,068)
(4,574)
84,933
Income tax (benefit) expense
(4,124)
(14,524)
-
10,400
(Loss) income from continuing operations
$ (329,585)
$ (399,544)
$ (4,574)
$ 74,533
(Loss) income from discontinued operations, net of tax
$ (181,729)
$
-
$ (193,363)
$ 11,634
Net (loss) income
$ (511,314)
$ (399,544)
$ (197,937)
$ 86,167
Basic and diluted EPS from continuing operations
(3.21)
$
²
Net interest margin
4.68%
³
Tangible common book value per common share
35.84
$
Market value per common share
34.18
$
Q2 2014 *
and Income Tax
|
 Business
Segments (GAAP) 16
___________________
¹
Excludes discontinued operations.
²
Non-fully taxable equivalent.
($ in millions)
Financial Results
Q3 14
Q2 14
Variance
Q3 14
Q2 14
Variance
Net interest income
316
$
334
$
(18)
$
26
$
49
$
(23)
$
Non-interest income
96
38
58
17
18
(1)
Gross revenues
412
372
40
43
67
(24)
Provision for loan losses – non-covered loans
62
74
(12)
6
(25)
31
Provision for loan losses – covered loans
12
12
-
-
-
-
Total provision for loan losses
74
86
(12)
6
(25)
31
Operating expenses
245
223
22
48
40
8
Income tax expense (benefit)
31
(8)
39
1
1
-
Income (loss) from continuing operations
62
$
71
$
(9)
$
(12)
$
51
$
(63)
$
Income (loss) from discontinued operations, net of tax
-
$
-
$
-
$
30
$
(182)
$
212
$
Net income (loss)
62
$
71
$
(9)
$
18
$
(131)
$
149
$
($ in millions)
Balance Sheet Highlights
Q3 14
Q2 14
Variance
Q3 14
Q2 14
Variance
Total assets
26,765
$
27,647
$
(882)
$
7,133
$
8,299
$
(1,166)
$
Total loans ¹
18,567
18,684
(117)
3,624
3,784
(160)
Total deposits ¹
20,986
21,144
(158)
3,551
3,819
(268)
($ in millions)
Asset Quality (including covered assets)
Q3 14
Q2 14
Variance
Q3 14
Q2 14
Variance
Non-performing loans held-in-portfolio
607
$
590
$
17
$
30
$
66
$
(36)
$
Non-performing assets
871
860
11
72
95
(23)
Allowance for loan losses
579
565
14
32
60
(28)
Net interest margin ²
5.25%
5.50%
-0.25%
1.82%
3.25%
-1.43%
PR
US |
 $ in
millions Q3 14
Q2 14
Q1 14
Q4 13
Q3 13
Loans Held in Portfolio (HIP)
$19,359
$19,635
$21,612
$21,612
$21,427
Performing HFS
158
93
94
109
123
NPL HFS
20
4
1
1
2
Total Non Covered Loans
19,537
19,732
21,707
21,722
21,552
Non-performing loans (NPLs)
$622
$640
$635
$598
$618
Commercial
$252
$278
$307
$279
$316
Construction
$19
$22
$22
$24
$29
Legacy
$6
$8
$12
$15
$24
Mortgage
$295
$286
$252
$233
$203
Consumer
$47
$43
$39
$44
$42
Leases
$3
$3
$3
$3
$4
NPLs HIP to loans HIP
3.21%
3.26%
2.94%
2.77%
2.88%
Net charge-offs (NCOs)
$40
$46
$43
$35
$58
Commercial
$0
$10
$11
$15
$21
Construction
($1)
($1)
($2)
($2)
($5)
Legacy
$0
($1)
($5)
($5)
$2
Mortgage
$13
$10
$9
$8
$13
Consumer
$27
$26
$28
$18
$27
Leases
$1
$2
$1
$1
$0
Write-downs
$32
$20
$0
$0
$0
NCOs to average loans HIP
0.83%
0.94%
0.80%
0.66%
1.08%
Provision for loan losses (PLL)
$56
$50
$47
$48
$55
PLL to average loans HIP
1.16%
1.02%
0.88%
0.89%
1.03%
PLL to NCOs
1.39x
1.08x
1.10x
1.35x
0.95x
Allowance for loan losses (ALL)
$522
$526
$543
$538
$526
ALL to loans HIP
2.69%
2.68%
2.51%
2.49%
2.46%
ALL to NPLs HIP
83.88%
82.26%
85.40%
90.05%
85.19%
Consolidated Credit Summary (Excluding Covered Loans)
1
Excluding provision for loan losses and net write-downs related to the classified and legacy assets
sale Numbers may not add to total due to rounding.
17
1
1
1
1 |
 BPPR
Commercial & Construction Distribution Loan Composition (Held-in
Portfolio) De-risked Loan Portfolios
•
The Corporation has derisked its loan portfolios by
reducing its exposure in asset classes with
historically high loss content
•
In the BPPR commercial portfolio reductions
include:
Commercial portfolio, including construction,
has decreased from 55% of total loans held-
in-portfolio to 41%
Construction portfolio is down by 88% since
Q4 2007
SME lending is down by 55% from Q4 2007
•
Collateralized exposure now represents a larger
portion of consumer loan portfolio
•
Unsecured loans credit quality has improved as
overall FICO scores have increased
1
Small and Medium Enterprise
2
NCOs distribution represents the percentage allocation of NCOs
from Q1 2008 through Q2 2014 per each loan category
Legacy portfolio is comprised of certain commercial, construction and lease financings lending
products exited by the US. 18
NCOs
($mm)
(%)
($mm)
(%)
($mm)
(%)
Distribution
(2)
CRE SME ¹
$2,938
33%
$1,497
23%
($1,441)
-49%
24%
C&I SME
¹
2,287
25%
859
13%
(1,428)
-62%
29%
C&I Corp
1,592
18%
1,870
29%
278
17%
6%
Construction
1,231
14%
149
2%
(1,082)
-88%
37%
CRE Corp
892
10%
1,983
31%
1,091
122%
4%
Multifamily
64
1%
60
1%
(4)
-6%
1%
Total
$9,004
$6,419
($2,585)
-29%
100%
Q4 2007
Q3 2014
Variance
1
$ in millions
Q4 2007
Q3 2014
Q4 2007
Q3 2014
Q4 2007
Q3 2014
Variance
Commercial
$7,774
$6,270
$4,515
$1,789
$12,288
$8,059
($4,229)
Consumer
3,552
3,401
1,698
491
5,249
3,892
(1,357)
Mortgage
2,933
5,453
3,139
1,102
6,071
6,555
484
Construction
1,231
149
237
63
1,468
212
(1,256)
Leases
814
550
-
-
814
550
(264)
Legacy
-
-
2,130
91
2,130
91
(2,039)
Total
$16,304
$15,823
$11,718
$3,536
$28,020
$19,359
($8,661)
Puerto Rico
US
Total
Numbers may not add to total due to rounding |
 Popular, Inc.
Credit Ratings •
Our senior unsecured ratings have remained stable:
Moody’s:
B2
Negative
Fitch:
BB-
Stable Outlook
S&P:
B+
Stable Outlook
•
May 2014: Moody’s downgraded BPOP to B2; outlook negative
•
February 2014: Moody's placed BPOP on review for downgrade
•
October 2013: Moody’s revised outlook to negative
•
January 2013: Fitch raised to BB-
from B+; outlook stable
•
December 2012: Moody’s downgraded BPOP to B1; outlook stable
•
April 2012: Moody’s placing most of the PR banks under review with the possibility
of downgrades, due to the state of the Puerto Rico economy
•
January 2012: Fitch raised BPOP’s outlook to positive
•
December 2011: S&P raised its ratings on BPPR to BB from BB-
and changed outlook to stable
given revised bank criteria to regional banks
19 |
 Investor
Presentation Third Quarter 2014 |