Slide 1: Financial Results Fourth Quarter 2011
Exhibit 99.1 Financial Results Fourth Quarter 2011
Slide 2: Forward Looking Statements
Forward Looking Statements 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 uncertaintie
Slide 3: 2011 Highlights
2011 Highlights • Net Income for the year amounted to $151 million Strong NIM of 4.34% Provision for loan losses down 43% from prior year • Net income of $3 million in Q4; fourth consecutive profitable quarter Results include a one-time expense of $15.6 million due to employee retirement window Impr
Slide 4: Financial Results
Financial Results ¹ Unaudited 3
Slide 5: Q4 vs. Q3 2011 Adjusted Variances
Q4 vs. Q3 2011 Adjusted Variances (in millions) Variance in pre-tax income Explanation Lower net interest income: Covered loans $ (17) Mortgage loans (8) ($In millions) (25) FDIC loss share increase: Accretion of indemnification asset 2 ASC 310-20 and provision-mirror acct. 21 Q4 vs. Q3 variance as
Slide 6: Capital Ratios
Capital Ratios • Strong capital ratios 14.52% 15.97% 15.79% 17.25% 10.94% 12.10% Q4 Q4 Q4 Q4 7.99% 8.62% 2010 2011 10%² Q4 Q4 2010 2011 6%² 2010 2011 Q4 Q4 5%² 2010 2011 Tier 1 Common 1 Tier 1 Capital Total Capital Tangible Common Equity • There is no specific plan at this time for TARP repayment no
Slide 7: Consolidated Credit Summary
Consolidated Credit Summary Excluding covered loans • NPAshavedecreasedsinceQ410 principallydriven by the saleof non-performingloans • NCOsslightly declinedin the fourth quarter, although experiencingvariability within the portfolios • Provisionfor loanlossesfor 2011 wasdown 43% vs 2010 • Allowance&
Slide 8: Credit Quality Overview - Excludes Covered Loans & LHFS
Credit Quality Overview-Excludes Covered Loans & LHFS • NPLs increased by $6 million in Q4 driven by higher PR mortgage offset by reductions in construction. The Non-Performing Loans- Popular, Inc. increase in Q3 was $107 million. • NCO ratio for Q4 was 2.46% ($126 million) vs. 2.64% ($135 million)
Slide 9: Summary & Outlook
Summary & Outlook 2011 Highlights 2012 Strategy • First year of operational profitability • Further improve credit risk profile since 2006 • Add low-risk assets Further expanded strong margin • Expand efficiency efforts Reduced credit cost by 43% from • Continue improvement at BPNA 2010 Strengthened
Slide 10: Appendix
Appendix
Slide 11: Where We Are Coming From
Where We Are Coming From 2005/2006 2007/2008 2009/2010 2011/2012 • Aggressive diversification •Reorganized U.S. operation • Focused on ensuring • Focused on: Strategy consisting of Puerto Rico, the capital and BHC liquidity to exit high-risk businesses Puerto Rico U.S. and the Caribbean; adequacy an
Slide 12: P.R. & US Business
P.R. & US Business PR US $ in millions (Unaudited) Q4 11 Q3 11 Variance Q4 11 Q3 11 Variance Net Interest Income $299 $321 ($22) $73 $73 ($0) Non Interest Income 136 118 18 21 18 3 Gross Revenues 435 439 (4) 94 91 3 Provision (non-covered) (88) (131) 43 (36) (20) (16) Provision (covered WB) (56) (26
Slide 13: Credit Ratings Update
Credit Ratings Update • Our senior unsecured ratings have been gradually improving since 2010: Moodys: Ba1 Negative Outlook S&P: B+ Stable Outlook Fitch: B+ Positive Outlook • Feb, 2011: Fitch raised our senior unsecured rating by one notch to B+ • July, 2011: S&P raised our senior unsecured rating
Slide 14: TARP Capital Accounting Overview
TARP Capital Accounting Overview • In 2009, we exchanged $935 million in perpetual preferred shares we issued to the US Treasury in 2008, for perpetual trust-preferred securities (“Trups”) with the same terms and conditions The coupon remained unchanged at 5%, stepping up to 9% in 12-2013 • Under GA
Slide 15: Financial Results Fourth Quarter 2011
Financial Results Fourth Quarter 2011