First Bancorp. New · NYSE:FBP
First Bancorp. New — First Bancorp — Investor Presentation (August 2018)
35 slides from First Bancorp. New's investor presentation, Aug 20, 2018
Slide 1: First BanCorp Investor Presentation August 2018
First BanCorp Investor Presentation August 2018 Exhibit 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain “forward-looking statements” concerning the Corporation’s future economic, operational and financial performance. The words or phrases “expect,” “anticipate,” “intend,” “look forward,” “should,” “would,” “believes” and similar expressions are
Slide 3: Compelling Value Proposition
Compelling Value Proposition Our business model is diverse and scalable by segment (commercial, residential and consumer) and by unique markets (Puerto Rico, Southeast Florida & Eastern Caribbean). Our equity is valued at 105% of TBV (8/17/18) and at below 50% of the SNL bank index (205% of TBV). Ou
Slide 4: Franchise Overview
Franchise Overview Founded in 1948 Headquartered in San Juan, Puerto Rico with operations in PR, Eastern Caribbean (Virgin Islands) and Florida ~2,640 FTE employees(1) 2nd largest financial holding company in Puerto Rico with attractive business mix and substantial loan market share Florida presence
Slide 5: Franchise Positioning
Franchise Positioning Well-positioned Puerto Rico institution in a consolidating market Well-positioned Puerto Rico institution in a consolidating market Source: PR Market Share Report prepared with data provided by the Commissioner of Financial Institutions of Puerto Rico as of 3/31/18. 1) Puerto R
Slide 6: Diversified Business Model Across Regions
Diversified Business Model Across Regions Strong Capital and Operational Foundation to Support Growth 1) Originations include purchases, refinancings, and draws from existing revolving and non-revolving commitments. Consumer Banking Attractive branch network across densely populated regions in Puert
Slide 7: Main market continues to show signs of economic recovery
Main market continues to show signs of economic recovery Financial industry performance in the aftermath of both Hurricanes Irma and Maria has exceeded original expectations and has triggered a re-assessment of our progress and corporate goals for 2018 to maximize our opportunities Several drivers o
Slide 8: Significant inflow of disaster-related funds
Significant inflow of disaster-related funds As a result of the extraordinary influx of both public and private funds, the economic backdrop for Puerto Rico and USVI has improved considerably Recent government reports suggest that approximately $62 billion in federal aid and private insurance disbur
Slide 9: Favorable Funding Mix
1) Core deposits are total deposits excluding brokered CDs. Favorable Funding Mix Total Deposit Composition (%) Core Deposits(1) ($ millions) Non-brokered deposits, excluding government deposits, increased $376 million YTD 2018 Reliance on brokered deposits declined $327 million YTD 2018 Non-interes
Slide 10: Geographic Diverse Business Model Sustains Portfolio
Geographic Diverse Business Model Sustains Portfolio 1) Including refinancing and draws from existing revolving and non-revolving commitments. Loan Originations* ($ millions) Loan Portfolio ($ millions) Residential Mortgage Consumer & Finance Leases Construction Commercial Loans HFS Our island is sh
Slide 11: Improving Core Performance
Improving Core Performance Pre-tax pre-provision income of $61.4 million(1) average 4 quarters of $57.4 million Replacement of NPLs with performing loans should reduce provisioning needs Future earnings potential with a reduction in costs associated with managing NPLs and OREO Opportunities for inco
Slide 12: Proactively Managing Asset Quality
Proactively Managing Asset Quality Commercial NPLs (Includes HFS) NPA Composition Residential Consumer Construction Commercial Loans HFS REO & Repo $621 $641 $575 $651 Net Carrying Amount = % of unpaid principal balance net of reserves and accumulated charge-offs. $637 Non-Performing Assets ($ milli
Slide 13: Earnings Continue to Drive Significant Capital Formation
Earnings Continue to Drive Significant Capital Formation Tangible Book Value per Share Capital Ratios (%) Equity is valued at 105% of TBV (8/17/18) and at below 50% of the SNL bank index (205% of TBV) Capital ratios are among top 5% of banks above $10 billion in assets Capital ratios are approximate
Slide 14: Executing for Earnings Growth
Executing for Earnings Growth Puerto Rico Opportunities for ongoing market share gains Largest opportunity on deposit products, electronic banking & transaction services Growth in selected loan products for balanced risk/return to manage risk concentration and diversify income sources FirstBank-bran
Slide 15: Stronger Franchise: Proven Success Implementing Strategic Plan
Stronger Franchise: Proven Success Implementing Strategic Plan Our business model is diverse and scalable by segment (commercial, residential and consumer) and by unique markets (Puerto Rico, Southeast Florida & Eastern Caribbean). Our equity is valued at 105% of TBV (8/17/18) and at below 50% of th
Slide 16: Exhibits
Exhibits
Slide 17: Franchise History
Franchise History Our turnaround story De-Risking of Balance Sheet Building Capital Enhanced Franchise Value June 2010: Written Agreement with the FED and Consent Order with FDIC. July 2010: The U.S. Treasury exchanged TARP preferred for convertible preferred. August 2010: Exchange of 89% Perpetual
Slide 18: Diversity in Core Franchise
Our well-diversified business model within commercial, consumer and residential across three unique regions allows us to be agile when responding to growth opportunities Line of business diversification: Commercial represents 42%, residential represents 37% and consumer represents 21% of the total l
Slide 19: Stock Profile
Stock Profile Trading Symbol: FBP Exchange: NYSE Share Price (8/17/18): $8.79 Shares Outstanding (in 000’s as of 7/31/18): 217,184 Market Capitalization (8/17/18): $1.9 billion Average 3M Daily Volume: 1,791,540 Tangible Book Value per Share (6/30/18) $8.40 Price (8/17/18) to Tangible Book Value (6/
Slide 20: FBP Stock Price Performance
FBP Stock Price Performance 8/3/17 PEs complete 20mm share secondary 11/30/16 PEs complete 21mm share secondary 2/2/17 PEs complete 23mm share secondary 5/10/17 US Treasury sells remaining 10mm share TARP Investment 11/8/16 Presidential election FBP showed strong institutional demand for shares duri
Slide 21: Puerto Rico Bank Sector Price / TBV Performance
Puerto Rico Bank Sector Price / TBV Performance Puerto Rico bank valuations continue to trail the broader market. 1) Source: SNL Financial. Information November 1, 2016 to Present.
Slide 22: 2017 DFAST Results
2017 DFAST Results Under the 2017 Fed provided Severely Adverse Scenario, assuming a nine quarter average Real GDP Contraction of 6.35% and 17.0% Unemployment Rate in Puerto Rico, stressed capital ratios are 500 basis points above “Well Capitalized” regulatory capital requirements DFAST Projected St
Slide 23: Second Quarter 2018 Results
Second Quarter 2018 Results
Slide 24: Second Quarter 2018 Highlights
Second Quarter 2018 Highlights Profitability 2Q 2018 net income of $31.0 million, or $0.14 per diluted share, compared to $33.1 million in 1Q 2018 Adjusted pre-tax, pre-provision income of $61.4 million, compared to $60.7 million for 1Q 2018 Net interest income increased $5.8 million compared to 1Q
Slide 25: Results of Operations: Second Quarter Financial Highlights
Results of Operations: Second Quarter Financial Highlights ($ in thousands, except per share data) Select Financial Information
Slide 26: Key Highlights: Net Interest Income
Key Highlights Net Interest Income ($ millions) Net interest income increased $5.8 million in 2Q 2018. This increase was mainly due to: A $3.3 million increase in interest income on commercial and construction loans primarily due to the upward repricing of variable rate loans and interest collected
Slide 27: Key Highlights: Adj. Non-Interest Income
Key Highlights Adj. Non-Interest Income* ($ millions) * Non-GAAP adjusted non interest income – See Appendix page 35 for reconciliation. Non-interest income for 2Q 2018 amounted to $20.5 million, compared to $22.8 million for 1Q 2018. Non-interest income for 1Q 2018 included the $2.3 million gain on
Slide 28: Results of Operations: Operating Expenses
Results of Operations: Operating Expenses Non-interest expenses increased by $4.2 million in 2Q 2018 to $90.2 million. Non-interest expenses for 2Q 2018 included $0.7 million ($1.6 million in 1Q 2018) in storm-related costs substantially all included in occupancy and equipment. Excluding theses item
Slide 29: Key Highlights: Net Charge-Offs
Key Highlights Net Charge-Offs ($ millions) Net charge-offs for 2Q 2018 were $23.4 million, or an annualized 1.07% of average loans, compared to $26.5 million, or an annualized 1.21% of average loans, in 1Q 2018. Allowance coverage ratio of 2.57% compared to 2.60% in 1Q 2018. The ratio of the allowa
Slide 30: Second Quarter 2018 Highlights: Capital Position
Second Quarter 2018 Highlights: Capital Position Capital Ratios (%) Total stockholders’ equity amounted to $1.9 billion as of June 30, 2018, an increase of $24.6 million from March 31, 2018, mainly driven by the earnings generated in the first quarter, partially offset by a decrease in the fair valu
Slide 31: NPL Migration
NPL MIGRATION ($ in 000) Sse ac Putte 3) henaves menes iy) cays 'y) Garey @) aries jaa aeearae wm pera 1 sas ,59 ‘Non-performing loans transferred to OREO (6,709) (862) (215) (240) - (8,026) Haan oaiaiai ged-off (4,064) 3,897) (5,061) (785) (10,528) (24,335) mento cong om | ua | tah | Gam wie peat d
Slide 32: Second Quarter 2018 Highlights: PR Government Exposure
Second Quarter 2018 Highlights: PR Government Exposure ($ in millions) As of June 30, 2018, the Corporation had $213.2 million of direct exposure to the Puerto Rico Government, its municipalities and public corporations, compared to $213.4 million as of March 31, 2018. 86% of direct government expos
Slide 33: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation contains non-GAAP financial measures. Non-GAAP financial measures are used when management believes they will be helpful to an understanding of the Corporation’s results of operations or fin
Slide 34: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation contains non-GAAP financial measures. Non-GAAP financial measures are used when management believes they will be helpful to an understanding of the Corporation’s results of operations or fin
Slide 35: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation contains non-GAAP financial measures. Non-GAAP financial measures are used when management believes they will be helpful to an understanding of the Corporation’s results of operations or fin