Popular, Inc. · NASDAQ:BPOP
Popular — Q1 2014 Earnings Presentation
21 slides from Popular's earnings presentation, Apr 23, 2014
Slide 1: Financial Results Q1 2014
Exhibit 99.1 FINANCIAL RESULTSQ1 2014
Slide 2: Forward Looking Statements
Forward Looking Statements The information contained in this presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are based on management’s current expectations and involve risks and uncertaintie
Slide 3: Q1 2014 Highlights
Q1 2014 Highlights • Reported net income of $86 million Earnings • Strong margins: Popular, Inc. 4.70%, BPPR 5.49% • Consolidated NPLs remained relatively flat at 2.9% vs. 2.8% QoQ Credit • NCOs of 0.80% compared to 0.66% last quarter • NPL inflows impacted by $52 million PR commercial loan added to
Slide 4: BPNA Transactions
BPNA Transactions • Sale of all branches, deposits and substantially all loans in California, Illinois and Central Florida regions Strategic focus going forward on NY metro and South Florida regions • Simplifying operations through back office consolidation from Rosemont, IL to San Juan, PR and New
Slide 5: TARP & Capital
TARP & Capital • Submitted an application to repay TARP in full; subject to regulatory approval • Robust capital, Tier1 Common Equity ratio of 15.1%, $2.4 billion in excess of 5% CCAR target • BHC cash approximately $680 million after the effect of the BPNA dividend Minimum Well Q1 2014 Pro-forma Ca
Slide 6: Financial Summary (unaudited)
Financial Summary (unaudited) Q1 2014 Q4 2013 See appendix for Non-GAAP to GAAP reconciliation Non GAAP Adjusted In thousands Adjusted Variance Net interest income $372,967 $376,342 ($3,375) Non Interest Income 130,771 135,996 (5,225) Total revenues before FDIC loss share impact 503,738 512,338 (8,6
Slide 7: Capital
Capital Tier 1 Common Equity capital ratio of 15.1% exceeds current CCAR 5% target by $2.4 billion We expect to remain “well-capitalized” under Basel III rules issued by the Federal Reserve Capital Ratio % Excess capital in $, billions BPOP Q1 2014 CCAR & CapPR Q4 2013 * $3.1 20.6 $2.5 19.4 $2.4 15.
Slide 8: Non Performing Assets
Non Performing Assets Overall Stable; Impacted by Single Commercial Credit Relationship Non-Performing Assets ($MM) • NPAs, including covered loans, increased by $24 million, or 3%, QoQ • OREOs decreased by $8 million, or 3%, mainly driven by higher disposition of foreclosed properties from the cove
Slide 9: NPL Inflows
NPL Inflows Q1 2014 inflows impacted by Single Commercial Credit Relationship • Total NPL inflows increased by $64 million, or Total NPL Inflows ($MM) 45% QoQ BPPR commercial inflows include the impact of a single $52 million credit relationship, which continues to be current BPNA commercial increas
Slide 10: Stable Asset Quality
Stable Asset Quality • NCOs increased by $8 million QoQ Impact of $9 million recovery in Q4 2013 from the NCO ($MM) and NCO-to-Loan Ratio sale of previously charged-off PR credit cards and personal loans NCO ratio of 0.80% compared to 0.66% in Q4 2013 • Provision flat at $47 million in Q1 2014 vs. $
Slide 11: PR Public Sector Exposure
PR Public Sector Exposure • Our current direct exposure to the PR government, instrumentalities and municipalities is $1.1 billion, of which approximately $944 million is outstanding, flat to last quarter • Of the amount outstanding, $781 million consists of loans and $163 million are securities PR
Slide 12: Driving Shareholder Value
Driving Shareholder Value • Robust capital with excess Tier 1 Common Equity of $2.4 billion and Capital significantly improved asset quality move us closer to TARP exit in the most shareholder-friendly fashion • BPNA transactions are the first steps toward a more active capital management process •
Slide 13: Appendix
ff] POPULAR. Investor Presentation APPENDIX
Slide 14: Who We Are – Popular, Inc.
Who We Are – Popular, Inc. Franchise Summary Corporate Structure • Financial services company • Headquartered in San Juan, Puerto Rico Assets = $36.7 bn • Puerto Rico operations $37 billion in assets (top 40 bank holding company in the U.S.) Banco Popular Popular Popular North Popular de Puerto Insu
Slide 15: Market Leadership in Puerto Rico
Market Leadership in Puerto Rico Popular’s Market Share Trend Puerto Rico Market Share by Category Market Market Share Category Position as of as of Q4 2013 Q4 2013 Total Deposits (Net of Brokered) 1 39% Total Loans 1 36% Commercial & Construction Loans 1 39% Credit Cards 1 52% Mortgage Loan Product
Slide 16: PR & US Business
PR & US Business 1 Excludes covered loans 15
Slide 17: GAAP Reconciliation Q4 2013
GAAP Reconciliation Q4 2013 [1] Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements. 16
Slide 18: Consolidated Credit Summary (Excluding Covered Loans)
Consolidated Credit Summary (Excluding Covered Loans) $ in millions Q1 14 Q4 13 Q3 13 Q2 13 Q1 13 Loans Held in Portfolio (HIP) $21,612 $21,612 $21,427 $21,522 $21,634 Performing HFS 94 109 123 180 183 NPL HFS 1 1 2 11 18 Total Non Covered Loans 21,707 21,722 21,552 21,713 21,835 Non - performing lo
Slide 19: De-risked Loan Portfolios
De-risked Loan Portfolios • PR has derisked its commercial loan Loan Composition (Held-in Portfolio) portfolio by reducing its exposure in asset classes with historically high loss content Puerto Rico US Total $ in millions Q4 2007 Q1 2014 Q4 2007 Q1 2014 Q4 2007 Q1 2014 Variance Commercial portfoli
Slide 20: Popular, Inc. Credit Ratings
Popular, Inc. Credit Ratings • Our senior unsecured ratings have been gradually improving since 2010: • Moody’s: B1 Watch (Revised February 2014) • Fitch: BB- Stable Outlook (Reaffirmed December 2013) • S&P: B+ Stable Outlook (Revised December 2011) • February 2014: Moody's placed BPOP on review for
Slide 21: Financial Results Q1 2014
ff] POPULAR. Investor Presentation FINANCIAL RESULTS) 1 2014