29 slides from First Bancorp. New's investor presentation, Aug 1, 2016
Slide 1: First BanCorp Investor Presentation August 2016
First BanCorp Investor Presentation August 2016 Exhibit 99.1
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain “forward-looking statements” concerning the Corporation’s future economic and financial performance. The words or phrases “expect,” “anticipate,” “intend,” “look forward,” “should,” “would,” “believes” and similar expressions are meant to iden
Slide 3: Investment Thesis: The Value of First BanCorp
Investment Thesis A turn-around story underscored by steady improvement and organic market share gains in the core franchise, operating within a challenging macro environment. Strong, tenured leadership team with a commitment to increasing shareholder value, while fulfilling our vision to be the mos
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 ~2,700 FTE employees(1) 2nd largest financial holding company in Puerto Rico with attractive business mix and substantial loan market share Florida presence
Slide 5: Strengthening geographic and line of business diversification
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 43%, residential represents 37% and consumer represents 20% of the total
Slide 6: Diversified business model across all regions
Diversified business model across all regions Franchise Overview Consumer Banking Mortgage Banking Commercial Lending Focus on small to middle market commercial and corporate borrowers across FBP’s footprint. Complimented by full suite of deposit and business products. Balanced risk/return profile t
Slide 7: Well positioned Puerto Rico institution in a consolidating market
Franchise Overview 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 03/31/16. 1) Puerto Rico only. 2) Calculated as institution bank branches within a mile o
Slide 8: Executing for Earnings Growth
Executing for Earnings Growth Puerto Rico Market Share 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 inco
Slide 9: Second Quarter 2016 Highlights
Second Quarter 2016 Highlights Franchise Overview: Profitability Net income of $22.0 million, or $0.10 per diluted share, compared to $23.3 million in 1Q 2016; Adjusted 1Q 2016 net income, excluding items that affect comparability, was $25.8 million. Net interest income declined $4.4 million, due to
Slide 10: Successful core deposit growth: Favorable Funding Mix
Total Deposit Composition (%) Core Deposits(1) ($ millions) 1) Core deposits are total deposits excluding brokered CDs. Non-brokered deposits, excluding government deposits, increased $95 million YTD 2016. Reliance on brokered deposits declined $288 million YTD 2016. Puerto Rico non-brokered deposit
Slide 11: Geographic Diverse Business Model Sustains Portfolio
Geographic Diverse Business Model Sustains Portfolio 1) Including refinancing and draws from existing revolving and non-revolving commitments. Loan Originations* ($ millions) Loan Portfolio ($ millions) $880 Residential Mortgage Consumer & Finance Leases Construction Commercial Loans HFS Loan Portfo
Slide 12: Proactively Managing Asset Quality
Proactively Managing Asset Quality NPA Composition * Net Carrying Amount = % of carrying value net of reserves and accumulated charge-offs. Residential Consumer Construction Commercial Loans HFS REO & Repo $610 $756 $644 $617 Non-Performing Assets ($ millions) Commercial NPLs (Includes HFS) $737 Dir
Slide 13: Proactively Managing Asset Quality: Quarterly Migration Trends
Proactively Managing Asset Quality Quarterly Migration Trends ($ in 000)
Slide 14: Puerto Rico Government Exposure
($ in millions) Puerto Rico Government Exposure ($ in millions) As of June 30, 2016, the Corporation had $336.5 million of direct exposure to the Puerto Rico Government, its municipalities and public corporations, compared to $340.5 million as of March 31, 2016. Available-for-sale investment portfol
Slide 15: Stable Core Performance in Challenging Environment
Stable Core Performance in Challenging Environment Pre-tax pre-provision income of $50.5 million1 average 4 quarters of $51 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.
Slide 16: Earnings Continue to Drive Capital Formation
Capital Ratios (%) Capital Ratios (%) Earnings Continue to Drive Capital Formation Total stockholders’ equity amounted to $1.8 billion as of June 30, 2016, an increase of $37.3 million from March 31, 2016, mainly driven by $22.0 million of net income and an increase of $13.9 million in other compreh
Slide 17: Stronger Franchise: Proven Success Implementing Strategic Plan
Stronger Franchise: Proven Success Implementing Strategic Plan Our franchise has never been stronger and is poised to increase shareholder value navigating through fiscal and economic challenges. Strong, tenured leadership team with exceptional track record of executing strategic plan during challen
Slide 18: Exhibits
Exhibits
Slide 19: Exhibits
Exhibits Page Stock Profile…………………………………………………………………………………………………………….20 History …………………………………………………………………………………………………………………….21 2Q 2016 Earnings Presentation…………………………………………………………………………………22 Non-GAAP Reconciliations……………………………………………………………………………………….28
Slide 20: Stock Profile
Stock Profile Trading Symbol: FBP Exchange: NYSE Share Price (7/27/16): $4.65 Shares Outstanding (as of June 30, 2016): 217,129,074 Market Capitalization (7/27/16): $1,014 million 1 Yr. Average Daily Volume: 934,322 Price (7/27/16) to Tangible Book (6/30/16): 0.60x Includes the U.S. Treasury warrant
Slide 21: History
June 2010: Written Agreement with the FED and Consent Order with FDIC. July 2010: The U.S. Treasury exchanged TARP for convertible preferred. August 2010: Exchange of 89% Perpetual Preferred Stock for Common. Feb 2011: Sale of non-performing loans with book value of $269 million. Feb-April 2011: Sal
Slide 22: Results of Operations: Second Quarter Financial Highlights
Results of Operations: Second Quarter Financial Highlights ($ in thousands, except per share data) Select Financial Information
Slide 23: Results of Operations: Net Interest Income
Key Highlights Net Interest Income ($ millions) Net interest income decreased $4.4 million in 2Q 2016. This decrease was mainly due to: A $3.0 million decrease in interest income on loans driven by: lower loan volumes driven by repayments; the impact of loans moved to nonaccrual status over the firs
Slide 24: Results of Operations: Non-Interest Income
Key Highlights Non-Interest Income* ($ millions) * Non interest income excludes equity losses of unconsolidated entities, OTTI, HFS bulk sale impact and bargain purchase gain. Adjusted non-interest income, excluding the OTTI charge and gain on the repurchase and cancellation of TRUPs in 1Q 2016, dec
Slide 25: Results of Operations: Operating Expenses
Results of Operations: Operating Expenses Non-interest expenses decreased by $3.5 million in 2Q 2016 to $89.5 million, due to: A $1.2 million decrease in occupancy and equipment costs, including reductions in repairs, electricity, rental and depreciation expenses. A $1.0 million decrease in employee
Slide 26: Results of Operations: Net Charge-offs
Key Highlights Net Charge-Offs ($ millions) Total net charge-offs for 2Q 2016 were $25 million, an annualized 1.11% of average loans, compared to $24 million in 1Q 2016. Allowance coverage ratio of 2.64% remained flat compared to 1Q 2016. The ratio of the allowance to NPLs held for investment was 39
Slide 27: Results of Operations: Key Margin Drivers
Results of Operations: Key Margin Drivers Q2 vs. Q1 Change in Average Interest Earning Assets & Interest Bearing Liabilities * On a tax equivalent basis and excluding valuations ($ in 000)
Slide 28: 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 29: 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