Popular, Inc. · NASDAQ:BPOP
Popular — Merger or Acquisition (July 2009)
20 slides from Popular's merger presentation, Jul 8, 2009
Slide 1: Exchange Offer Presentation
Exchange Offer Presentation July 8, 2009
Slide 2: Forward Looking Statements
Forward Looking Statements Statements contained in this Presentation that are not based on current or historical fact are forward-looking in nature. Such forward-looking statements are based on current plans, estimates and expectations. Forward-looking statements are based on known and unknown risks
Slide 3: Agenda
Agenda Current Situation Exchange Offer Overview Popular, Inc. Business Discussion Closing Remarks Q&A
Slide 4: Current Situation & Exchange Offer Overview
Current Situation & Exchange Offer Overview
Slide 5: Popular, Inc. Exchange Offer
Popular, Inc. Exchange Offer Purpose of exchange offer To increase Popular, Inc.'s common equity by up to $1.1 billion How does the exchange offer work? Investors: Preferred Stock TRUPS On June 29th, we launched the exchange offer. Current investors in the Corporation's preferred stock and trust pre
Slide 6: Developments Leading to Exchange Offer: Deteriorating U.S. & P.R. Economies
Developments Leading to Exchange Offer Deteriorating U.S. & P.R. Economies Economic environment has deteriorated sharply since 2007 U.S. recession on pace to be longest since Great Depression (Q1 2009 marked 16 months) Unemployment at 9.5%, 26-year high Massive correction in home values Widespread c
Slide 7: Developments Leading to Exchange Offer: Changing Regulatory Expectations Regarding Capital
Developments Leading to Exchange Offer- Changing Regulatory Expectations Regarding Capital Ten of the largest 19 banks were required by the Supervisory Capital Assessment Program (stress tests) to bolster their capital buffers by a combined $75 billion in additional common equity The objective of th
Slide 8: Developments Leading to Exchange Offer: Popular Capital Assessment
Developments Leading to Exchange Offer- Popular Capital Assessment Even though Popular was not one of the top 19 banking institutions included in the SCAP, we have closely assessed the announced SCAP results, particularly noting that: SCAP credit loss assumptions are based on a more adverse economic
Slide 9: Overview of Exchange Transaction
Overview of Exchange Transaction
Slide 10: Exchange Offer Summary
Exchange Offer Summary We have launched an offer to exchange our trust preferred securities (TRUPS) and preferred stock, which amount to $1.4 billion, for up to 390 million shares of our common stock * The closing sale price for our Common Stock on the Nasdaq Stock Market on July 7, 2009 was $1.68 p
Slide 11: Recent Trading Levels - Preferred & TRUPS vs. Exchange Value Offered
Recent Trading Levels - Preferred & TRUPS vs. Exchange Value Offered Market prices for the preferred stock and trust preferred securities have decreased significantly in recent months. TRUPS Market Price Source: Bloomberg Exchange value of 67.2% offered to 6.70% Popular Capital Trust I & 6.125% Popu
Slide 12: Exchange Offer Timeline
Exchange Offer Timeline 6/8 6/8 Announce exchange and file preliminary S-4 6/29 6/29 Launch exchange offer 7/28 7/28 Exchange offer expires 7/31 Exchange settlement 7/31 Note: All future dates are subject to change 7/20 VWAP Averaging Period begins 7/20 7/24 7/24 VWAP Averaging Period ends
Slide 13: Popular, Inc. Business Discussion
Popular, Inc. Business Discussion
Slide 14: Strategy Adaptation and Recent Financial Events
Q3 08 Q4 08 Q1 09 BPPR 35394 12421 179810 Q3 08 Q4 08 Q1 09 BPNA -139043 -349503 -213476 Q3 08 Q4 08 Q1 09 Popular Inc -211173 -702900 -42576 We have adapted strategy to the changing business environment: Integration of U.S. banking business under one single management Consolidation of U.S. bank foo
Slide 15: Credit Cost Trends
Credit Cost Trends The main driver pressuring our profitability is rising credit costs from several segments of the portfolio. The provision for loan losses in Q1 2009 amounted to $372.5 million, an annualized 5.8% of average loans held in portfolio. (In 2005, provision for loan losses amounted to $
Slide 16: Credit Cost Mitigation Initiatives
Credit Cost Mitigation Initiatives Exited subprime mortgage lending in U.S. and non-core businesses, sold subprime and leasing portfolios and shut down the E-LOAN and HELOC origination channels A non-conventional mortgage loan modification program in the U.S. is underway: As of Q1 2009, $110 million
Slide 17: Recap
Recap The impact of the economic environment on credit quality has put pressure on profitability and capital Multiple measures have been implemented to address challenges in the credit quality of our loan portfolios The increase in common equity expected from the successful completion of the exchang
Slide 18: Q & A
Q & A
Slide 19: Notice
Notice In connection with the exchange offers, Popular, Inc. has filed a Registration Statement on Form S-4 that contains a prospectus and related exchange offer materials with the Securities and Exchange Commission (the "SEC") on June 29, 2009. This registration statement has not yet become effecti
Slide 20: Exchange Offer Presentation
Exchange Offer Presentation July 1, 2009