25 slides from First Bancorp. New's earnings presentation, Jul 24, 2013
Slide 1: Financial Results Second Quarter 2013
Financial Results Second Quarter 2013
Slide 2: Forward-Looking Statements
Forward‐Looking Statements This presentation contains “forward‐looking statements” concerning First BanCorp’s (the “Corporation”) future economic performance. The words or phrases “would be,” “will allow,” “intends to,” “will likely result,” “are expected to,” “expect,” “anticipate,” “look forward,”
Slide 3: Agenda
Agenda �� Second Quarter 2013 Highlights: Aurelio Alemán, President & Chief Executive Officer �� Second Quarter Results of Operations: Orlando Berges, Executive Vice President & Chief Financial Officer �� Summary �� Questions & Answers
Slide 4: Second Quarter 2013 Highlights
SECOND QUARTER 2013 Highlights
Slide 5: Second Quarter 2013 Highlights
SECOND QUARTER 2013 Highlights Profitability • Net loss of $122.6 million, or $0.60 per diluted share, including a $72.9 million loss related to the bulk sale of assets and $66.6 million loss related to the write‐off of assets pledged as collateral with Lehman. • Adjusted net income of $16.8 million
Slide 6: Second Quarter 2013 Highlights: Loan Portfolio
Second Quarter 2013 Highlights: LOAN PORTFOLIO Strong origination activity at $1 billion for Q2 13: - Residential mortgages originations increased $33 million; - Consumer loans originations increased $33 million: • Auto loan originations increased $11 million • Personal loan originations increased $
Slide 7: Deposit growth strategy and reduced brokered CDs
Continued focus on deposit growth strategy; deposits excluding brokered CDs grew $73.0 million. We achieved this while reducing the cost of deposits net of brokered from 0.84% to 0.81%. �� Continued focus on cross‐selling opportunities. �� Reduced reliance on brokered deposits: - 33% of deposits are
Slide 8: Second Quarter 2013 Results of Operations
SECOND QUARTER 2013 Results of Operations
Slide 9: Significant Events
Results of Operations: SIGNIFICANT EVENTS �� Impairment of Collateral Pledged with Lehman ‐ On May 13, 2013, we announced that the Bank’s motion for summary judgment was denied. As a result of this decision FBP recorded a non‐cash charge of $66.6 million associated with the write‐off of the carrying
Slide 10: Net Income
Results of Operations: NET INCOME �� Net loss of $123 million, includes: �� $66.6 million charge for the Lehman write‐off; and �� $72.9 million loss on bulk sale of loans. �� Adjusted gain of 16.8 million in Q2 2013 compared to an adjusted net loss of $4.6 million in Q1 2013 and income of $9.4 milli
Slide 11: Revenue & Margin Expansion
Results of Operations: REVENUE & MARGIN EXPANSION �� NIM expanded 8 basis points, while net interest income increased $2.4 million compared to Q1 13. �� NIM increased 58 basis points yearover‐ year. �� Net interest income increased $2.4 million in the second quarter due to: - $2.0 million decrease i
Slide 12: Cost of Funds
Results of Operations: COST OF FUNDS �� Cost of total deposits, excluding brokered CDs, decreased to 0.81% from 0.84% in Q2 2013. �� The average rate paid on non‐brokered deposits, including interest‐bearing checking accounts, savings and retail CDs, declined by 5 basis points to 0.93% during the se
Slide 13: Non-Interest Income
Results of Operations: NON‐INTEREST INCOME �� Non‐interest income (loss) of $(51.7) million in Q2 2013. Write‐off of Lehman collateral of 66.6 million reflected in non interest income. Excluding this charge, adjusted noninterest income of $14.3 million for Q2 13. �� Reduction of $4.9 million for Q2
Slide 14: Operating Expenses
Results of Operations: OPERATING EXPENSES �� Increase of $8.1 million in credit related expenses: - $1.9 million loss on OREO sales as part of the bulk sale transaction - $5.3 million in fair value adjustment of almost all commercial OREOs in the VI �� $3.2 million impact of new tax on gross revenue
Slide 15: Asset Quality
Results of Operations: ASSET QUALITY �� NPAs are down over $1 billion, or 58%, since the peak in Q1 10; and $335 million, or 31%, compared to Q1 13. �� Total NPLs are also down over $1 billion, or 73%, since the peak in Q1 10; and $230 million, or 28%, compared to Q1 13. �� Commercial NPLs are being
Slide 16: Net Charge-offs & Allowance Coverage
Results of Operations: NET CHARGE‐OFFS & ALLOWANCE COVERAGE ($ in millions) �� Total net charge‐offs for Q2 2013 were $129 million, or 5.25% of average loans. �� The bulk loan sales completed in the last two quarters and the transfer of loans to held for sale in the first quarter added $98.0 million
Slide 17: Capital Position
Results of Operations: CAPITAL POSITION �� The Corporation’s total stockholders’ equity amounted to $1.2 billion as of June 30, 2013, a decrease of $181.7 million from March 31, 2013, driven by the net loss of $122.6 million and a decrease of $60 million in other comprehensive income due to unrealiz
Slide 18: Summary: Key Quarter Highlights
Summary: KEY QUARTER HIGHLIGHTS Executing Strategic Plan: • Asset Quality: Remains our top priority. 13th Consecutive Quarter of reductions in NPAs, down $335 million or 31% compared to prior quarter. • Profitability: Our NIM improved 8 basis points to 4.04% compared to Q1 through reduced funding co
Slide 19: Second Quarter 2013 Q&A
SECOND QUARTER 2013 Q&A
Slide 20: Exhibits
EXHIBITS
Slide 21: Income statement summary
Interest income 160,670 $ 160,225 $ 444 $ 153,652 $ Interest expense 33,782 35,732 (1,950) 44,947 Net interest income 126,888 124,493 2,394 108,705 Provision for loan and lease losses 87,464 111,123 (23,658) 24,884 Non‐interest income 14,263 19,167 (4,904) 16,513 Impairment of collateral pledged wit
Slide 22: Key Margin Drivers Q2 vs. Q1
Results of Operations: FIRST QUARTER KEY MARGIN DRIVERS Q2 vs. Q1 Change in Average Interest Earning Assets & Interest Bearing Liabilities * On a tax equivalent basis and excluding valuations $ ∆ in % ∆ in Average Average Volume Rate Average total investments 92,904 $ 0.33% 2,799 $ Average loans & l
Slide 23: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Basis of Presentation ‘measures are set forth when management believes they will be helpful to an erezlts of operations or fnancial psition. Where now-GAAP financial mearares arsed, oo comparable GAAP nancial ‘measure, as well as the reconciliation to the comparabl
Slide 24: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operation
Slide 25: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operation