Popular, Inc. · NASDAQ:BPOP
Popular — Q3 2021 Earnings Presentation
20 slides from Popular's earnings presentation, Oct 20, 2021
Slide 1: Investor Presentation Third Quarter 2021
INVESTOR PRESENTATION Third Quarter 2021 Exhibit 99.2
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. These statements are not guarantees of future performance, are based on the current expectations of Popular, I
Slide 3: Q3 2021 Highlights
NPLs decreased $52.3 million QoQ; ratio at 2.2%, from 2.4% the prior quarter NCO ratio at 0.12% compared to (0.02%) the previous quarter ACL to loans of 2.49% compared to 2.70% in Q2 2021 Credit Metrics Net income of $248.1 million Net interest margin: Popular, Inc. 2.77%, BPPR 2.75% Provision for c
Slide 4: Business Highlights
Business Highlights BPPR Business Metrics Issued $2.1 billion or 49,700 loans ($1.4 billion in Round 1 and $678 million in Round 2) As of September 30, 2021: Outstanding loans: $129 million from Round 1 and $541 million from Round 2 Recognized $59 million YTD in income from program $40 million unamo
Slide 5: Puerto Rico – Key Indicators
Puerto Rico – Key Indicators Economy 1 Source: United Automobile Importers Group (based on units) as of September 2021; 2 Source: Puerto Rico Economic Development Bank, Q3 2021 estimated based on July and August 2021 Actuals; 3 Source: U.S. Bureau of Labor Statistics (Seasonally Adjusted) as of Augu
Slide 6: Financial Summary
Financial Summary (Unaudited) (Sin thousands) Q3 2021 Q2 2021 Variance Net interest income $ 489,393 | $ 487,802, $1,591 Service charges on deposits 41,312 40,153 1,159 Other service fees 80,445 76,382 4,063 Mortgage banking activities 8,307 7,448 859 Other non-interest income 39,194 30,557 8,637 Gr
Slide 7: Net Interest Margin Dynamics
Net Interest Margin Dynamics Q3 2021 net interest margin at 2.77%; FTE1 net interest margin at 3.04% Money market and investment securities to earning assets ratio at 59% FTE loan yield increased 2 basis points QoQ to 6.15%, driven by PPP income Total deposit cost for the quarter down 2 basis points
Slide 8: Capital
Capital Robust capital levels; Common Equity Tier 1 of 17.4% Leverage ratio of 7.4% impacted by the high proportion of zero-risk weighted assets on the balance sheet, which represented 46% of total assets Tangible book value per share of $66.01 up $2.77 from Q2 2021 Capital actions: Completed $350 m
Slide 9: Non-Performing Assets
Non-Performing Assets ($ in millions) Non-Performing Assets NPAs decreased by $57 million QoQ NPLs decreased by $52 million QoQ P.R. NPLs at $609 million, or 2.9% of loans, down by $48 million, driven by: Lower commercial NPLs by $34 million, mainly due to payment activity Lower mortgage NPLs by $16
Slide 10: NPL Inflows
NPL Inflows Total NPL Inflows ($ in millions) Mortgage NPL Inflows ($ in millions) Differences due to rounding Total NPL inflows decreased by $43 million QoQ P.R. inflows decreased by $37 million QoQ, as the prior quarter included a $32 million commercial relationship U.S. inflows decreased by $7 mi
Slide 11: NCOs and Allowance for Credit Losses
NCOs and NCO-to-Loan Ratio ($ in millions) NCOs and Allowance for Credit Losses Differences due to rounding NCOs increased by $10 million QoQ, mostly driven by: Higher commercial NCOs by $14 million, mostly due to the effect of recoveries of $8 million in Q2 2021 from an NPL resolution Lower mortgag
Slide 12: Allowance for Credit Losses – Q3 2021 Movement
Allowance for Credit Losses – Q3 2021 Movement Differences due to rounding ACL Movement: Moody’s August vintage continues to show a favorable economic scenario. Changes in the forecast of income-based variables contributed to the reduction in ACL Stability in the economic outlook and borrower perfor
Slide 13: Driving Value
Driving Value Capital Completed $350 million Accelerated Share Repurchase program; repurchased 4.6 million shares at an average price of $75.84 Announced the redemption of outstanding $187 million 6.70% Trust Preferred Securities, to be completed in Q4 Franchise Additional Value Investments in Evert
Slide 14: Appendix
INVESTOR PRESENTATION Appendix Third Quarter 2021
Slide 15: Franchise Summary
Franchise Summary Corporate Structure Assets = $63 billion Assets = $10 billion Puerto Rico Operations United States Operations Assets = $74 billion Information as of September 30, 2021 ¹ Doing business as Popular Selected equity investments EVERTEC and Banco BHD León under Corporate segment Transac
Slide 16: Business Segments
Differences due to rounding Business Segments
Slide 17: 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 co
Slide 18: FICO Mix of Consumer Originations
FICO Mix of Consumer Originations
Slide 19: Popular, Inc. Credit Ratings
Popular, Inc. Credit Ratings Senior Unsecured Ratings Moody’s Ba3 Stable Outlook Fitch BBB- Stable Outlook S&P BB- Positive Outlook February Moody’s changes outlook to Positive from Negative April S&P upgrades to BB- from B+ revised outlook to Positive 2017 October Fitch and S&P change outlook to Ne
Slide 20: Third Quarter 2021
INVESTOR PRESENTATION Third Quarter 2021