Popular, Inc. · NASDAQ:BPOP
Popular — Presentation (October 2017)
14 slides from Popular's investor presentation, Oct 31, 2017
Slide 1: 2017 Annual Stress Test Disclosure – Severely Adverse Scenario
2017 Annual Stress Test DisclosureSeverely Adverse Scenario October 2017
Slide 2: Forward Looking Statements
1 Forward Looking Statements This presentation contains “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995, including without limitation those about Popular, Inc.’s (the “Corporation,” “Popular,” “us,” “our”) business, financial condition, re
Slide 3: Index
2 Index 2017 Supervisory Severely Adverse Scenario Results 3 Page Risk Methodologies 8 Macroeconomic Scenario 13
Slide 4: Overview
3 Overview Popular, Inc. (“Popular” or the “Corporation”) is the leading financial services provider in Puerto Rico (“P.R.”) and ranks among the 50 largest bank holding companies by assets in the United States (“U.S.”), with consolidated assets of $41 billion as of June 30, 2017. Popular operates 22
Slide 5: Capital and RWA Projections (Severely Adverse Scenario)
4 Capital and RWA Projections (Severely Adverse Scenario) Projected stressed capital ratios Projected risk-weighted assets Projected risk weighted assets are mainly impacted by lower loan origination within the Puerto Rico loan portfolio driven in part by a continued reduction in the forecasted econ
Slide 6: Profit and Loss Projections (Severely Adverse Scenario)
5 Profit and Loss Projections (Severely Adverse Scenario) Nine-quarter cumulative provision for loan and lease losses, PPNR, and net income (Q1 2017-Q1 2019) Nine-quarter cumulative projected loan losses (Q1 2017-Q1 2019) 1 Average assets is the nine-quarter average of total assets (from Q1 2017 thr
Slide 7: 2017 DFAST Pro Forma Capital Ratio Key Drivers
6 2017 DFAST Pro Forma Capital Ratio Key Drivers Popular Common Equity Tier 1 ratio under Supervisory Severely Adverse Scenario * - The Other category represents mainly the impact of the Basel III threshold deductions as they transition through 2018. - Dotted lines represent minimum well capitalized
Slide 8: Index
7 Index 2017 Supervisory Severely Adverse Scenario Results 3 Page Risk Methodologies 8 Macroeconomic Scenario 13
Slide 9: Key Risks Captured in Stress Test Projections
8 Key Risks Captured in Stress Test Projections Credit Risk Potential for default or loss resulting from an obligor’s failure to meet its contractual obligation to the Corporation or any of its subsidiaries, or failure otherwise to perform as agreed. Credit risk arises from all activities where succ
Slide 10: Model and Risk Components Captured in Stress Test
9 Model and Risk Components Captured in Stress Test Interest Rate Risk Market Risk Liquidity Risk Operational, Compliance, Legal and Regulatory Risks Credit Risk Scenario specific interest rates were derived to complement the key interest rates provided by the Federal Reserve. These interest rate sc
Slide 11: Model and Risk Components Captured in Stress Test
10 Model and Risk Components Captured in Stress Test Risks embedded in earnings – Gains/losses on securities, Trading securities, Equity investments, OREO, HFS loans losses Purpose Estimate future impairment and/or valuation losses impacting the capital base for other assets positions (i.e., non- lo
Slide 12: Model and Risk Components Captured in Stress Test
11 Model and Risk Components Captured in Stress Test Risks embedded in earnings – Operational losses Purpose Estimated operational losses expected in each quarter under varying macroeconomic conditions. Methodology Losses related to operational risk events are a component of PPNR and include losses
Slide 13: Index
12 Index 2017 Supervisory Severely Adverse Scenario Results 3 Page Risk Methodologies 8 Macroeconomic Scenario 13
Slide 14: 2017 DFAST Annual Macroeconomic Scenario
13 2017 DFAST Annual Supervisory Severely Adverse Scenario The Supervisory Severely Adverse Scenario, as provided by the Federal Reserve, is a hypothetical scenario that is designed to assess the strength of banking organizations during periods of economic stress. The objective of this scenario is t