Popular, Inc. · NASDAQ:BPOP
Popular — Q2 2017 Earnings Presentation
17 slides from Popular's earnings presentation, Jul 26, 2017
Slide 1: Investor Presentation Second Quarter 2017
Investor Presentation Second Quarter 2017 Exhibit 99.1
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 forward-looking statements may relate to Popular, Inc’s (the “Corporation”, “we”, “us”, “our”) financial
Slide 3: Q2 2017 Quarter Highlights
2 NPLs decreased by $28 million QoQ; ratio at 2.4% NPL inflows, excluding consumer loans, down by $20 million QoQ NCO ratio increased to 1.01% from 0.63% in previous quarter Credit (excluding covered loans) Net income of $96.2 million Strong margins: Popular, Inc. 4.02%, BPPR 4.36% Earnings Robust c
Slide 4: Financial Summary (GAAP)
Financial Summary (GAAP) (Unaudited) ($ in thousands) Q2 2017 Qi 2017 Variance Net interest income $ 374,879 $362,098 | $ 12,381 FDIC loss-share expense (475) (8,257), 7,782 Other non-i i 117,268 124,126 | _ (6,858) Gross revenues 491,272 477,967 | 13,305 Provision for loan losses ~ non-covered loan
Slide 5: Capital
Capital Popular’s capital levels remain robust with Common Equity Tier 1 of 16.7% Tangible book value per share of $44.71 Popular, Inc. (%) Note: Capital ratios for the current quarter are preliminary
Slide 6: P.R. Public Sector Exposure
Our direct exposure to the P.R. Government, instrumentalities, and municipalities is $519 million, of which approximately $517 million is outstanding, relatively flat QoQ. Exposure to P.R. Government securities consists of senior COFINA bonds ($14 million), which were sold after quarter-end. Central
Slide 7: Non-Performing Assets Highlights
Non-Performing Assets Highlights NPAs, including covered loans, decreased by $38 million QoQ NPLs, excluding covered loans, decreased by $28 million QoQ P.R. NPLs at $517 million, or 3.0% of loans, down by $31 million, mainly driven by lower mortgage and commercial NPLs of $13 million each U.S. NPLs
Slide 8: NPL Inflows
NPL Inflows Total NPL Inflows ($ in millions) Highlights Total NPL inflows down by $20 million QoQ P.R. commercial inflows down by $20 million, as the prior quarter was impacted by a single $25 million relationship P.R. mortgage inflows flat QoQ U.S. inflows flat QoQ Excludes consumer loans Mortgage
Slide 9: NCOs, Provision and ALLL Ratios
NCOs and NCO-to-Loan Ratio ($ in millions) Provision and Provision-to-NCO Ratio ($ in millions) Highlights Net charge-offs (NCOs) increased by $22 million from Q1 2017, driven by: Higher P.R. commercial NCOs of $9 million, driven by a $12 million charge-off taken on a previously reserved single rela
Slide 10: Driving Shareholder Value
Capital Robust capital with Common Equity Tier 1 Capital of 16.7% Tangible book value per share of $44.71 Earnings Unique franchise in P.R. generating strong and stable revenue Continued loan growth in the U.S. Additional Value EVTC ownership and Banco BHD León stake Driving Shareholder Value
Slide 11: Second Quarter 2017 Appendix
Investor Presentation Second Quarter 2017 Appendix
Slide 12: Who We Are – Popular, Inc.
Who We Are – Popular, Inc. Franchise Summary Corporate Structure Assets = $41 billion Assets = $32 billion Assets = $9 billion Puerto Rico Operations United States Operations Selected equity investments EVERTEC and Banco BHD León under Corporate segment and joint ventures under BPPR segment Transact
Slide 13: De-Risked Loan Portfolios
De-Risked Loan Portfolios The Corporation has de-risked its loan portfolios by reducing its exposure to asset classes with historically high loss content The P.R. commercial portfolio reductions include: Commercial portfolio, including construction, has decreased from 55% of total loans held-in-port
Slide 14: Business Segments (GAAP)
Business Segments (GAAP) ¹ Non-fully taxable equivalent (Unaudited) ($ in millions) Financial Results Q2 2017 Q1 2017 Variance Q2 2017 Q1 2017 Variance Net interest income 320 $ 310 $ 10 $ 70 $ 67 $ 3 $ Non-interest income 102 100 2 5 5 - Gross revenues 422 410 12 75 72 3 Provision for loan losses –
Slide 15: Consolidated Credit Summary (Excluding Covered Loans)
Consolidated Credit Summary (Excluding Covered Loans) 1 Excluding provision for loan losses and net write-downs (recoveries) related to the assets sales Differences due to rounding
Slide 16: 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- Stable 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 BPOP
Slide 17: Second Quarter 2017
Investor Presentation Second Quarter 2017