Ofg Bancorp · NYSE:OFG
Ofg Bancorp — Q3 2023 Earnings Presentation
26 slides from Ofg Bancorp's earnings presentation, Oct 20, 2023
Slide 1: Quarterly Results 3Q23 Conference Call
Quarterly Results 3Q23 Conference Call October 20, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements The information included in this document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and involve certain risks and uncertainties tha
Slide 3: 3Q23 Summary
3Q23 Summary Income Statement Balance Sheet (EOP) Capital • EPS $0.95 • Total Assets $10.3B • CET1 14.03% • Total Core Revenues $172.2M • Customer Deposits $8.5B • Tier 1 Risk-Based 14.03% • NIM 5.80% • Loans Held for Investment $7.3B • Total Risk-Based 15.29% • Provision $16.4M • New Loan Productio
Slide 4: Our "Digital First" Strategy at Work
Our “Digital First” Strategy at Work Data and comparisons are YTD Sept. 2023 vs. Year-Ago Period Now Through Retail Digital/Self- Service Channels • 87% of all routine customer transactions • 92% of all deposit transactions Key Drivers • 11% growth in digital enrollment • 14% growth in digital loan
Slide 5: Financial Highlights
Financial Highlights Total Core Revenues ($M) EPS TBV Per Common Share $172 $0.97 $0.96 $171 $0.95 $21.06 $21.01 $168 $0.93 $164 $20.57 $0.87 $157 $0.84 $19.56 $146 $18.86 $18.46 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 Efficiency Ratio ROAA ROATCE 1.
Slide 6: Operational Highlights
Operational Highlights Loans ($B) Core Deposits ($B) New Loan Origination ($M) Average Balances Average Balances $7.19 $692 $8.95 $8.92 $616 $7.00 $8.76 $587 $8.59 $8.53 $8.62 $561 $563 $6.87 $511 $6.77 $6.70 $6.64 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23
Slide 7: Credit Quality & Capital Strength
Credit Quality & Capital Strength NCO Rate Provision ($M) NPL Rate Excludes PCD Loans $16.4 $15.0 1.81% 1.71% 1.61% 1.45% 1.05% $9.4 1.32% 1.33% $8.8 0.68% 0.66% 0.59% $7.1 $6.7 0.38% 0.27% 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 CET1 Ratio Total Sto
Slide 8: Outlook
Outlook Puerto Rico Macro • Ongoing flow of federal funds to rebuild infrastructure • Significant influx of private capital • Keeping a watchful eye on interest rate changes, inflation, possible mainland recession, and global uncertainties • Remain optimistic about PR’s decoupling from mainland econ
Slide 9: Appendix
Appendix
Slide 10: Snapshot (September 30, 2023)
Snapshot (September 30, 2023) Branches, ATMs and/or ITMs in All Major PR & USVI Markets Value Proposition • Puerto Rico’s challenger bank Puerto Rico USVI Total Branches 42 2 44 • Target specific retail and commercial customer segments Self-Service Kiosks 7 -- 7 ATMs 289 15 304 • “Más Que Listo (Mor
Slide 11: History of Capital Management & Growth
History of Capital Management & Growth • Organic growth and acquisitions have transformed Oriental into Assets ($B) Loans ($B) a full-service, island-wide financial institution $9.8 $9.9 $9.8 $6.6 $6.7 $6.5 • From 2002-2022, while local $9.2 $9.3 $6.3 deposits have increased 2.2x, $5.2 $5.0 OFG’s ma
Slide 12: 3Q23 Asset Balance Evolution ($M)
3Q23 Asset Balance Evolution ($M) 12
Slide 13: 3Q23 Loan Balance Evolution ($M)
3Q23 Loan Balance Evolution ($M) 13
Slide 14: 3Q23 Core Deposit Balance Evolution ($M)
3Q23 Core Deposit Balance Evolution ($M) 14
Slide 15: 3Q23 Deposit Balance Evolution: Retail vs. Commercial
3Q23 Deposit Balance Evolution: Retail vs. Commercial, Ex-Public Funds ($M) 15
Slide 16: Residential Mortgage Loans ($M)
Residential Mortgage Loans ($M) Portfolio New Loan Origination $1,808 $1,739 $1,704 $1,669 $1,622 $1,604 $63 $39 $36 $35 $33 $30 6/30/22 9/30/22 12/31/22 3/31/23 6/30/23 9/30/23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 NPLs (excludes PCD) NCO Rate $33 $33 $34 $31 $28 $25 0.03% -0.20% -0.04% -0.05% -0.10% -0.26
Slide 17: Commercial Loans ($M)
Commercial Loans ($M) Portfolio New Loan Origination $669 $708 $624 $642 $618 $622 $112 $2,105 $2,125 $83 $1,972 $1,917 $1,988 $1,964 $91 $124 $221 $70 $209 $56 $144 $145 $123 $98 Puerto Rico US Puerto Rico US 6/30/22 9/30/22 12/31/22 3/31/23 6/30/23 9/30/23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 NPLs (exclu
Slide 18: Auto Loans ($M)
Auto Loans ($M) Portfolio New Loan Origination $2,212 $236 $237 $220 $221 $222 $2,127 $2,039 $193 $1,964 $1,885 $1,800 6/30/22 9/30/22 12/31/22 3/31/23 6/30/23 9/30/23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 NPLs (excludes PCD) NCO Rate 1.11% 0.96% $21 $20 0.46% 0.57% $15 $16 0.17% $14 $13 0.09% 2Q22 3Q22 4Q2
Slide 19: Consumer Loans ($M)
Consumer Loans ($M) Portfolio New Loan Origination $613 $97 $594 $565 $86 $87 $537 $521 $76 $499 $73 $68 6/30/22 9/30/22 12/31/22 3/31/23 6/30/23 9/30/23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 NPLs (excludes PCD) NCO Rate 3.30% 3.33% 2.95% 2.52% 2.37% 1.98% $2 $3 $3 $3 $3 $3 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q2
Slide 20: Credit Quality
Credit Quality NCO Rate NPL Rate (excludes PCD) 1.81% 1.71% 1.61% 1.05% 1.45% 0.27% 0.68% 0.66% 0.59% 1.32% 1.33% 0.38% 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 Early Delinquency Rate Total Delinquency Rate 4.35% 4.04% 3.68% 3.67% 3.78% 3.40% 2.75% 2.75% 2.46% 2.53% 2.20% 2.11% 2Q
Slide 21: Reserve
Reserve ACL / Total Loans Held for Investment 2.82% 2.44% 2.40% 2.37% 2.32% 2.23% 2.22% 2.25% 2.17% 9/30/21 12/31/21 3/31/22 6/30/22 9/30/22 12/31/22 3/31/23 6/30/23 9/30/23 ACL by % of Portfolio 9/30/21 12/31/21 3/31/22 6/30/22 9/30/22 12/31/22 3/31/23 6/30/23 9/30/23 Auto 4.24 3.85 3.69 3.72 3.66
Slide 22: Core Non-Interest Income ($M)
Core Non-Interest Income ($M) Total Banking Services $18.1 $18.2 $33.0 $17.2 $17.5 $17.4 $17.3 $31.2 $30.3 $30.9 $30.4 $28.5 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 Wealth Management Mortgage Banking $8.3 $8.2 $8.3 $8.2 $7.7 $7.1 $6.5 $5.2 $5.4 $4.8 $4.9 $3.9 2Q22 3Q22 4Q22 1Q23
Slide 23: Capital: Fortress Balance Sheet
Capital: Fortress Balance Sheet Basel III Standardized ($ in millions except per share) 3Q23 2Q23 1Q23 4Q22 3Q22 CET1 Capital $ 1,121.9 $1,086.6 $1,063.9 $1,037.4 $995.3 CET1 Capital Ratio 14.03% 14.03% 14.07% 13.64% 13.38% Tier 1 Capital $1,121.9 $1,086.6 $1,063.9 $1,037.4 $995.3 Tier 1 Capital Rat
Slide 24: Income Statement Highlights: 3Q23 vs. 2Q23
Income Statement Highlights: 3Q23 vs. 2Q23 $ in millions 3Q23 2Q23 Δ Comment Total Interest Income • Cash $9.0 $9.0 ($0.0) • 2% lower average balance and 4 bps higher yield • Investment Securities 14.6 13.4 1.2 • 2% higher average balance and 19 bps higher yield • Loans 142.1 135.5 6.6 • 3% higher a
Slide 25: Income Statement Highlights: 3Q23 vs. 3Q22
Income Statement Highlights: 3Q23 vs. 3Q22 $ in millions 3Q23 3Q22 Δ Comment Total Interest Income • Cash $9.0 $5.7 $3.3 • 33% lower average balances and 305 bps higher yield • Investment Securities 14.6 12.8 1.8 • 3% lower average balances and 47 bps higher yield • Loans 142.1 116.2 25.9 • 7% highe
Slide 26: Thank you.
Thank you. Contact: IR Coordinator Gary Fishman gfishman@ofgbancorp.com 212-532-3232 Steven Anreder sanreder@ofgbancorp.com 212-532-3232