24 slides from First Bancorp. New's earnings presentation, Oct 24, 2013
Slide 1: Financial Results Third Quarter 2013
Financial Results Third Quarter 2013 First BanCorp.
Slide 2: Forward-Looking Statements
Forward‐Looking Statements This presentation contains “forward‐looking statements” concerning First BanCorp’s (the “Corporation”) future economic performance. The words or phrases “would be,” “will allow,” “intends to,” “will likely result,” “are expected to,” “expect,” “anticipate,” “look forward,”
Slide 3: Agenda
Agenda �� Third Quarter 2013 Highlights: Aurelio Alemán, President & Chief Executive Officer �� Third Quarter Results of Operations: Orlando Berges, Executive Vice President & Chief Financial Officer �� Summary �� Questions & Answers 3
Slide 4: Third Quarter 2013 Highlights
THIRD QUARTER 2013 Highlights
Slide 5: Profitability and Asset Quality Highlights
Profitability • Net income of $15.9 million, or $0.08 per diluted share, including $3.4 million in non‐recurring expenses related to the secondary stock offering and the conversion of credit cards. • Adjusted net income of $19.3 million, excluding the aforementioned items. These results were also im
Slide 6: Third Quarter 2013 Highlights: Loan Portfolio
6 Third Quarter 2013 Highlights: LOAN PORTFOLIO Strong origination activity at $920 million for 3Q 13: - Residential mortgages originations declined due to an increase in market interest rates; - Consumer loans originations were strong at $290 million; - Commercial volume increased $17 million to $4
Slide 7: Third Quarter Highlights: Deposit Mix
�� Continued focus on deposit growth strategy; deposits excluding brokered CDs grew $78.6 million. We achieved this while reducing the cost of deposits net of brokered from 0.81% to 0.79%. �� Continued focus on cross‐selling opportunities. �� Reduced reliance on brokered deposits: - 32% of deposits
Slide 8: Third Quarter Highlights: PR Government Exposure
8 Third Quarter Highlights: PR GOVERNMENT EXPOSURE ($ in millions) �� Total asset exposure to the Puerto Rico Government as of September 30, 2013 was just over $395 million �� In addition, there is $199 million of indirect exposure to the Tourism Development Fund supporting hotel projects. �� Total
Slide 9: Third Quarter 2013 Results of Operations
THIRD QUARTER 2013 Results of Operations
Slide 10: Income Statement Summary
Interest income 162,203 $ 160,670 $ 1,533 $ 166,964 $ Interest expense 31,298 33,782 (2,484) 41,461 Net interest income 130,905 126,888 4,017 125,503 Provision for loan and lease losses 22,195 87,464 (65,269) 28,952 Non‐interest income 15,968 14,264 1,704 17,325 Impairment of collateral pledged with
Slide 11: Revenue & Margin Expansion
11 Results of Operations: REVENUE & MARGIN EXPANSION �� NIM expanded 16 basis points, while net interest income increased $4.0 million compared to Q2 13. �� NIM increased 22 basis points year-over‐ year. �� Net interest income increased $4.0 million in the third quarter due to: - A decrease of $2.5
Slide 12: Cost of Funds
12 Results of Operations: COST OF FUNDS �� Cost of total deposits, excluding brokered CDs, decreased to 0.79% from 0.81% in Q3 2013. �� The average rate paid on non‐brokered deposits, including interest‐bearing checking accounts, savings and retail CDs, declined by 3 basis points to 0.90% during the
Slide 13: Non-Interest Income
13 Results of Operations: NON‐INTEREST INCOME* �� Excluding the impairment of the Lehman collateral in 2Q 2013 and the equity in earnings/(losses) of unconsolidated entities (related to investment in CPG/GS) non‐interest income increased $1.7 million compared to 2Q 2013, due to: - $3.4 million charg
Slide 14: Operating Expenses
14 Results of Operations: OPERATING EXPENSES �� Decrease of $7.5 million in credit related expenses. �� Deposit insurance premium and supervisory fees declined $1.2 million or 9% compared to 2Q. �� Secondary offering expenses of $1.7 million in 3Q. �� Credit card processing conversion expenses in 3Q
Slide 15: Asset Quality
2010 2011 2012 2013 15 Results of Operations: ASSET QUALITY �� NPAs are down over $533 million, or 42%, compared to Q3 12. �� Total NPLs are also down $510 million, or 51%, since Q3 12. �� Commercial NPLs are being carried at 56.5% of unpaid principal balance, net of specific reserves. ($ in million
Slide 16: Net Charge-offs & Allowance Coverage
16 Results of Operations: NET CHARGE‐OFFS & ALLOWANCE COVERAGE ($ in millions) �� Total net charge‐offs for 3Q 2013 were $34 million, or 1.41% of average loans. �� The bulk loan sales completed in the first two quarters and the transfer of loans to held for sale in the first quarter added $98.0 mill
Slide 17: Capital Position
17 Results of Operations: CAPITAL POSITION �� Total stockholders’ equity amounted to $1.2 billion as of September 30, 2013, a decrease of $1.9 million from June 30, 2013 Driven by a decrease of $18.5 million in other comprehensive income due to unrealized losses on available‐for‐sale securities attr
Slide 18: Summary: Key Quarter Highlights
18 Summary: KEY QUARTER HIGHLIGHTS Executing Strategic Plan: • Asset Quality: Remains our top priority. 14th Consecutive Quarter of reductions in NPAs, down $23 million compared to prior quarter. Inflows of nonperforming loans also declined $20 million compared to Q2 2013. • Profitability: Our NIM i
Slide 19: Third Quarter 2013 Q&A
THIRD QUARTER 2013 Q&A
Slide 20: Exhibits
EXHIBITS
Slide 21: Third Quarter Key Margin Drivers
21 Results of Operations: THIRD QUARTER KEY MARGIN DRIVERS Q3 vs. Q2 Change in Average Interest Earning Assets & Interest Bearing Liabilities * On a tax equivalent basis and excluding valuations $ ∆ in % ∆ in Average Average Volume Rate Average total investments (48,686) $ 0.49% 3,242 $ Average loan
Slide 22: Use of Non-GAAP Financial Measures
22 Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operat
Slide 23: Use of Non-GAAP Financial Measures
23 Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operat
Slide 24: Use of Non-GAAP Financial Measures
24 Use of Non-GAAP Financial Measures Basis of Presentation Use of Non-GAAP Financial Measures This presentation may contain non-GAAP financial measures. Non-GAAP financial measures are set forth when management believes they will be helpful to an understanding of the Corporation’s results of operat