Popular, Inc. · NASDAQ:BPOP
Popular — Q4 2018 Earnings Presentation
22 slides from Popular's earnings presentation, Jan 23, 2019
Slide 1: Investor Presentation Fourth Quarter 2018
Investor Presentation First Quarter 2018 Investor Presentation Fourth Quarter 2018 Exhibit 99.1
Slide 2: 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’s business, financial condition, results of operations, plans, objectives, and future performance. These statement
Slide 3: 2018 Full Year Highlights
NPL ratio flat at 2.3% YoY NCO ratio flat at 1.1% YoY Credit Metrics Net income of $618.2 million; adjusted net income of $487.3 million¹ Strong margins: Popular, Inc. 4.01%, BPPR 4.27% Earnings Robust capital; Common Equity Tier 1 Capital ratio of 16.9% Tangible book value per share of $46.90 compa
Slide 4: Q4 2018 Highlights
NPLs decreased by $21 million QoQ; ratio at 2.3% NCO ratio increased to 1.63% from 1.00% the previous quarter Credit Metrics Net income of $106.4 million; adjusted net income of $134.1 million¹ Strong margins: Popular, Inc. 4.25%, BPPR 4.51% Earnings Robust capital; Common Equity Tier 1 Capital rati
Slide 5: Financial Summary (GAAP)
Financial Summary (GAAP)1 1 See slide 6 for Q4 2018 adjusted Non-GAAP results
Slide 6: GAAP Reconciliation
GAAP Reconciliation1 1 Refer to the Corporation's Q4 2018 earnings release for more detailed information
Slide 7: Capital
Popular, Inc. (%) Capital Note: Estimated for the current period Robust capital levels; Common Equity Tier 1 of 16.9% Tangible book value per share of $46.90 compared to $44.62 in Q3 2018 Completed a $125 million accelerated share repurchase transaction in Q4 2018 2019 planned capital actions: $250
Slide 8: P.R. Public Sector Exposure: Municipalities
Municipalities Obligations of municipalities are backed by real and personal property taxes, municipal excise taxes, and/or a percentage of the sales and use tax. Indirect exposure includes loans or securities that are payable by non-governmental entities, but which carry a government guarantee to c
Slide 9: Non-Performing Assets and Loans
Highlights NPAs decreased by $18 million QoQ NPLs decreased by $21 million QoQ P.R. NPLs at $568 million, or 2.9% of loans, down by $13 million, mainly driven by lower mortgage NPLs of $25 million, in part offset by higher commercial NPLs of $12 million U.S. NPLs at $43 million, or 0.7% of loans, do
Slide 10: NPL Inflows
NPL Inflows Total NPL Inflows ($ in millions) Highlights Total NPL inflows remained flat QoQ P.R. mortgage inflows at $46 million continued to trend significantly lower than pre-hurricane levels P.R. commercial inflows remained stable QoQ U.S. inflows down by $2 million QoQ Mortgage NPL Inflows ($ i
Slide 11: NCOs, Provision and ALLL
NCOs and NCO-to-Loan Ratio ($ in millions) Provision and Provision-to-NCO Ratio ($ in millions) Highlights NCO ratio at 1.63% vs. 1.00% in Q3 2018, driven by: Higher P.R. commercial NCOs of $49 million, related to two large relationships Lower P.R. consumer and mortgage NCOs of $7 million and $4 mil
Slide 12: Puerto Rico's Banking Franchise
Market Leadership Digital Transformation Puerto Rico’s Banking Franchise 12 Total Deposits (net of brokered) 2 Total Loans P.R. Market Share Trend Continued strengthening deposit franchise Total deposits rose $4.0 billion or 14% from 2017 Non-public deposits grew $1.6 billion or 7% from 2017 1.3 mil
Slide 13: Driving Shareholder Value
Driving Shareholder Value Capital Robust capital with Common Equity Tier 1 Capital of 16.9% Tangible book value per share of $46.90 Continue to implement capital strategy Earnings Franchise in P.R. uniquely positioned to take advantage of improving economic trends Strong contribution from acquisitio
Slide 14: Fourth Quarter 2018 Appendix
Investor Presentation Fourth Quarter 2018 Appendix
Slide 15: Franchise Summary and Corporate Structure
Franchise Summary Corporate Structure Assets = $38 billion Assets = $9 billion Puerto Rico Operations United States Operations Assets = $48 billion Corporate Structure – Popular, Inc. Information as of December 31, 2018 ¹ Doing business as Popular Selected equity investments EVERTEC and Banco BHD Le
Slide 16: De-Risked Loan Portfolios
De-Risked Loan Portfolios The Corporation has de-risked its loan portfolios by reducing its exposure to asset classes with historically high loss content The P.R. commercial portfolio reductions include: Commercial portfolio, including construction, has decreased from 55% of total loans held-in-port
Slide 17: 2018 Financial Summary (GAAP)
2018 Financial Summary (GAAP)1 1 See slide 6 for Q4 2018 adjusted Non-GAAP results
Slide 18: Business Segments (GAAP)
Business Segments (GAAP) ¹ Non-fully taxable equivalent Differences due to rounding
Slide 19: 2018 Business Segments (GAAP)
2018 Business Segments (GAAP) ¹ Non-fully taxable equivalent Differences due to rounding (Unaudited) ($ in millions) Financial Results 2018 2017 Variance 2018 2017 Variance Net interest income 1,482 $ 1,280 $ 202 $ 305 $ 281 $ 24 $ Non-interest income 593 364 229 20 20 - Gross revenues 2,075 1,644 4
Slide 20: Consolidated Credit Summary
Consolidated Credit Summary 1 Beginning in Q2 2018 figures include loans previously classified as covered Differences due to rounding
Slide 21: Popular, Inc. Credit Ratings
Popular, Inc. Credit Ratings Our senior unsecured ratings have remained stable Moody’s B2 Stable Outlook Fitch BB- Stable 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 BPO
Slide 22: Fourth Quarter 2018
Investor Presentation Fourth Quarter 2018