Popular, Inc. · NASDAQ:BPOP
Popular — Q4 2017 Earnings Presentation
21 slides from Popular's earnings presentation, Jan 23, 2018
Slide 1: Investor Presentation Fourth Quarter 2017
Investor Presentation Fourth Quarter 2017 Exhibit 99.1
Slide 2: Cautionary Note Regarding Forward-Looking Statements
Cautionary Note Regarding 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,
Slide 3: 2017 Full Year Highlights
1 See slide 5 for reconciliation to GAAP figures 2017 Full Year Highlights Loan payment moratorium implemented during Q4 due to hurricanes NPLs decreased by $7 million YoY; ratio at 2.3% NCO ratio of 1.05% compared to 0.76% last year Credit (excluding covered loans) Net income of $107.7 million; Adj
Slide 4: Q4 2017 Highlights
Loan payment moratorium implemented during Q4 due to hurricanes NPLs decreased by $35 million QoQ; ratio at 2.3% NCO ratio increased to 1.61% from 0.92% in previous quarter Credit (excluding covered loans) Net loss of $102.2 million; Adjusted net income of $66.2 million¹ Write-down of the U.S. DTA o
Slide 5: Financial Summary (GAAP)
4 . Financial Summary (GAAP) 1 See slide 5 for reconciliation to GAAP figures Net loss of $102.2 million; Adjusted net income of $66.2 million¹
Slide 6: GAAP Reconciliation (Unaudited)
GAAP Reconciliation (Unaudited) ($ in thousands) Pre-tax Impact on net loss U.S. GAAP Net loss (102,154) $ Non-GAAP Adjustments: Impact of the Tax Cut and Jobs Act 1 - 168,358 168,358 Adjusted net income (Non-GAAP) 66,204 $ Q4 2017 Income tax effect 1 On December 22, 2017, the Tax Cut and Jobs Act (
Slide 7: Hurricanes Irma and Maria – Financial Impact
. Hurricanes Irma and Maria – Financial Impact * Includes $2.3 million and $3.5 million in provision for covered loans for the quarters ended December 31, 2017 and September 30, 2017, respectively Excluding the impact of MSR valuation, non interest income impact of: Approximately $11 million in Q3 A
Slide 8: Capital
Capital 7 Note: Capital ratios for the current quarter are preliminary Popular, Inc. (%) Popular’s capital levels remain robust with Common Equity Tier 1 of 16.3% Tangible book value per share of $43.02; impact of the DTA write-down of $1.65 per share DTA adjustment did not impact regulatory capital
Slide 9: P.R. Public Sector Exposure
The Corporation has no direct exposure to the P.R. central government or its public corporations. Our direct exposure to P.R. municipalities is $484 million, up by $2 million from the prior quarter. Municipalities Obligations of municipalities are backed by real and personal property taxes, municipa
Slide 10: Non-Performing Assets Highlights
Non-Performing Assets Highlights Loan payment moratorium implemented during Q4 due to hurricanes NPAs, including covered loans, decreased by $44 million QoQ NPLs, excluding covered loans, decreased by $35 million QoQ P.R. NPLs at $511 million, or 2.8% of loans, down by $37 million, driven by lower m
Slide 11: NPL Inflows
NPL Inflows Total NPL Inflows ($ in millions) Highlights Loan payment moratorium implemented during Q4 due to hurricanes Total NPL inflows down by $81 million QoQ P.R. commercial inflows up by $15 million QoQ P.R. mortgage inflows down by $96 million QoQ, impacted by payment moratorium U.S. inflows
Slide 12: NCOs and Provision Metrics
NCOs and NCO-to-Loan Ratio ($ in millions) Provision and Provision-to-NCO Ratio ($ in millions) Highlights Net charge-offs (NCOs) increased by $41 million to $94 million, of which $32 million are related to the U.S. Taxi Medallion portfolio NCO ratio at 1.61% vs. 0.92% in Q3 2017 Allowance for loan
Slide 13: Continued strengthening deposit franchise
Continued strengthening deposit franchise Total deposits rose $4.3 billion or 17% from 2016; $1.1 billion occurred in Q4 Non-public deposits grew $1.8 billion or 8% from 2016; $1.2 billion occurred in Q4 1.2 million customers enrolled in online banking; 190 thousand new enrollments in 2017 750 thous
Slide 14: Embracing Puerto Rico
13 EMBRACING PUERTO RICO Join us in helping rebuild Puerto Rico by making a charitable donation. Popular is leading the Embracing Puerto Rico initiative through its corporate foundations, Fundación Banco Popular and Popular Community Bank Foundation. Popular will drive donations from customers, part
Slide 15: Fourth Quarter 2017 Appendix
Investor Presentation Fourth Quarter 2017 Appendix
Slide 16: Who We Are – Popular, Inc.
Who We Are – Popular, Inc. Franchise Information as of December 31, 2017 ¹ Doing business as Popular Community Bank Summary Corporate Structure Assets = $44 billion Assets = $35 billion Assets = $9 billion Puerto Rico Operations United States Operations Selected equity investments EVERTEC and Banco
Slide 17: De-Risked Loan Portfolios
De-Risked Loan Portfolios The Corporation has de-risked its loan portfolios by reducing its exposure to asset classes with historically high loss content The P.R. commercial portfolio reductions include: Commercial portfolio, including construction, has decreased from 55% of total loans held-in-port
Slide 18: Business Segments (GAAP)
Business Segments (GAAP) ¹ Non-fully taxable equivalent (Unaudited) ($ in millions) Financial Results Q4 2017 Q3 2017 Variance Q4 2017 Q3 2017 Variance Net interest income 329 $ 321 $ 8 $ 73 $ 71 $ 2 $ Non-interest income 74 88 (14) 5 5 - Gross revenues 403 409 (6) 78 76 2 Provision for loan losses
Slide 19: Consolidated Credit Summary (Excluding Covered Loans)
Consolidated Credit Summary (Excluding Covered Loans) 1 Excluding provision for loan losses and net write-downs (recoveries) related to the assets sales Differences due to rounding
Slide 20: Popular, Inc. Credit Ratings
Popular, Inc. Credit Ratings Our senior unsecured ratings have remained stable Moody’s B2 Stable Outlook Fitch BB- Negative Outlook S&P BB- Negative Outlook February Moody’s changes outlook to stable from negative April S&P upgrades to BB- from B+ revised outlook to stable 2017 February S&P placed B
Slide 21: Fourth Quarter 2017
Investor Presentation Fourth Quarter 2017