Condensed consolidating financial information of guarantor and issuers of registered guaranteed securities

6 Months Ended

Jun. 30, 2014

Notes to Financial Statements [Abstract]

Schedule Condensed Financial Statements [Text Block]

Note 38 – Condensed consolidating financial information of guarantor and issuers of registered guaranteed securities

The following condensed consolidating financial information presents the financial position of Popular, Inc. Holding Company (“PIHC”) (parent only), Popular North America, Inc. (“PNA”) and all other subsidiaries of the Corporation at June 30, 2014 and December 31, 2013, and the results of their operations and cash flows for periods ended June 30,2014 and 2013.

PNA is an operating, wholly-owned subsidiary of PIHC and is the holding company of its wholly-owned subsidiaries: Equity One, Inc. and Banco Popular North America (“BPNA”), including BPNA's wholly-owned subsidiaries Popular Equipment Finance, Inc., Popular Insurance Agency, U.S.A., and E-LOAN, Inc.

PIHC fully and unconditionally guarantees all registered debt securities issued by PNA.

Popular International Bank, Inc. (“PIBI”) is a wholly-owned subsidiary of PIHC and is the holding company of its wholly-owned subsidiaries Popular Insurance V.I., Inc. In July 2013, the Corporation completed the sale of Tarjetas y Transacciones en Red Tranred, C.A., which was a wholly owned subsidiary of PIBI.

A potential source of income for PIHC consists of dividends from BPPR and BPNA. Under existing federal banking regulations any dividend from BPPR or BPNA to the PIHC could be made if the total of all dividends declared by each entity during the calendar year would not exceed the total of its net income for that year, as defined by the Federal Reserve Board, combined with its retained net income for the preceding two years, less any required transfers to surplus or to a fund for the retirement of any preferred stock. At June 30,2014, BPPR could have declared a dividend of approximately $452 million (December 31, 2013 - $504 million). However, on July 25, 2011, PIHC and BPPR entered into a Memorandum of Understanding with the Federal Reserve Bank of New York and the Office of the Commissioner of Financial Institutions of Puerto Rico that requires the approval of these entities prior to the payment of any dividends by BPPR to PIHC. BPNA could not declare any dividends without the approval of the Federal Reserve Board.

Condensed Consolidating Statement of Financial Condition (Unaudited)
		At June 30, 2014
							All other
			Popular Inc.		PNA		subsidiaries and		Elimination		Popular, Inc.
(In thousands)			Holding Co.		Holding Co.		eliminations		entries		Consolidated
Assets:
Cash and due from banks			$	1,253	$	612	$	363,424	$	(2,717)	$	362,572
Money market investments				19,734		599		1,648,210		(1,599)		1,666,944
Trading account securities, at fair value				1,577		-		344,246		-		345,823
Investment securities available-for-sale, at
	fair value			213		-		5,653,779		-		5,653,992
Investment securities held-to-maturity, at
	amortized cost			-		-		114,280		-		114,280
Other investment securities, at lower of cost
	or realizable value			10,850		4,492		152,783		-		168,125
Investment in subsidiaries				4,846,021		1,348,018		-		(6,194,039)		-
Loans held-for-sale, at lower of cost or
	fair value			-		-		97,010		-		97,010
Loans held-in-portfolio:
	Loans not covered under loss sharing
	agreements with the FDIC			588,241		-		19,724,436		(586,443)		19,726,234
	Loans covered under loss sharing
	agreements with the FDIC			-		-		2,736,102		-		2,736,102
	Less - Unearned income			-		-		91,010		-		91,010
	Allowance for loan losses			37		-		624,874		-		624,911
	Total loans held-in-portfolio, net			588,204		-		21,744,654		(586,443)		21,746,415
FDIC loss share asset				-		-		751,553		-		751,553
Premises and equipment, net				2,139		-		490,243		-		492,382
Other real estate not covered under loss
	sharing agreements with the FDIC			-		-		139,420		-		139,420
Other real estate covered under loss
	sharing agreements with the FDIC			-		-		155,805		-		155,805
Accrued income receivable				132		112		119,348		(72)		119,520
Mortgage servicing assets, at fair value				-		-		151,951		-		151,951
Other assets				506,637		25,815		1,775,648		(15,740)		2,292,360
Goodwill				-		-		461,247		(1)		461,246
Other intangible assets				554		-		39,568		-		40,122
Assets from discontinued operations				-		-		1,828,382		-		1,828,382
Total assets			$	5,977,314	$	1,379,648	$	36,031,551	$	(6,800,611)	$	36,587,902
Liabilities and Stockholders' Equity
Liabilities:
Deposits:
	Non-interest bearing		$	-	$	-	$	5,669,402	$	($2,717)	$	5,666,685
	Interest bearing			-		-		19,236,066		($1,599)		19,234,467
	Total deposits			-		-		24,905,468		(4,316)		24,901,152
Federal funds purchased and assets
	sold under agreements to repurchase			-		-		2,074,676		-		2,074,676
Other short-term borrowings				-		1,443		616,200		(586,443)		31,200
Notes payable				1,676,812		149,663		533,614		-		2,360,089
Other liabilities				40,061		7,219		849,241		(15,919)		880,602
Liabilities from discontinued operations				-		-		2,079,742		-		2,079,742
Total liabilities				1,716,873		158,325		31,058,941		(606,678)		32,327,461
Stockholders' equity:
Preferred stock				50,160		-		-		-		50,160
Common stock				1,035		2		56,307		(56,309)		1,035
Surplus				4,165,089		4,269,208		5,907,664		(10,168,345)		4,173,616
Retained earnings (accumulated deficit)				176,190		(3,044,262)		(861,999)		3,897,734		167,663
Treasury stock, at cost				(1,742)		-		-		-		(1,742)
Accumulated other comprehensive loss,
	net of tax			(130,291)		(3,625)		(129,362)		132,987		(130,291)
Total stockholders' equity				4,260,441		1,221,323		4,972,610		(6,193,933)		4,260,441
Total liabilities and stockholders' equity			$	5,977,314	$	1,379,648	$	36,031,551	$	(6,800,611)	$	36,587,902

Condensed Consolidating Statement of Financial Condition
		At December 31, 2013
							All other
			Popular, Inc.		PNA		subsidiaries and		Elimination		Popular, Inc.
(In thousands)			Holding Co.		Holding Co.		eliminations		entries		Consolidated
Assets:
Cash and due from banks			$	10,595	$	616	$	422,967	$	(10,967)	$	423,211
Money market investments				18,721		4,804		839,732		(4,804)		858,453
Trading account securities, at fair value				1,353		-		338,390		-		339,743
Investment securities available-for-sale, at
	fair value			204		-		5,294,596		-		5,294,800
Investment securities held-to-maturity, at
	amortized cost			-		-		140,496		-		140,496
Other investment securities, at lower of cost
	or realizable value			10,850		4,492		166,410		-		181,752
Investment in subsidiaries				4,856,566		1,670,809		-		(6,527,375)		-
Loans held-for-sale, at lower of cost or
	fair value			-		-		110,426		-		110,426
Loans held-in-portfolio:
	Loans not covered under loss sharing
	agreements with the FDIC			521,092		-		21,702,418		(519,500)		21,704,010
	Loans covered under loss sharing
	agreements with the FDIC			-		-		2,984,427		-		2,984,427
	Less - Unearned income			-		-		92,144		-		92,144
	Allowance for loan losses			304		-		640,251		-		640,555
	Total loans held-in-portfolio, net			520,788		-		23,954,450		(519,500)		23,955,738
FDIC loss share asset				-		-		948,608		-		948,608
Premises and equipment, net				2,135		-		517,381		-		519,516
Other real estate not covered under loss
	sharing agreements with the FDIC			-		-		135,501		-		135,501
Other real estate covered under loss
	sharing agreements with the FDIC			-		-		168,007		-		168,007
Accrued income receivable				64		114		131,368		(10)		131,536
Mortgage servicing assets, at fair value				-		-		161,099		-		161,099
Other assets				66,577		19,407		1,642,760		(41,186)		1,687,558
Goodwill				-		-		647,757		-		647,757
Other intangible assets				554		-		44,578		-		45,132
Total assets			$	5,488,407	$	1,700,242	$	35,664,526	$	(7,103,842)	$	35,749,333
Liabilities and Stockholders' Equity
Liabilities:
Deposits:
	Non-interest bearing		$	-	$	-	$	5,933,649	$	($10,967)	$	5,922,682
	Interest bearing			-		-		20,793,267		($4,804)		20,788,463
	Total deposits			-		-		26,726,916		(15,771)		26,711,145
Assets sold under agreements to repurchase				-		-		1,659,292		-		1,659,292
Other short-term borrowings				-		-		920,700		(519,500)		401,200
Notes payable				822,351		149,663		612,740		-		1,584,754
Other liabilities				39,906		39,245		728,899		(41,258)		766,792
Total liabilities				862,257		188,908		30,648,547		(576,529)		31,123,183
Stockholders' equity:
Preferred stock				50,160		-		-		-		50,160
Common stock				1,034		2		56,079		(56,081)		1,034
Surplus				4,161,625		4,479,208		6,056,774		(10,527,455)		4,170,152
Retained earnings (accumulated deficit)				602,957		(2,940,509)		(907,972)		3,839,954		594,430
Treasury stock, at cost				(881)		-		-		-		(881)
Accumulated other comprehensive
	loss, net of tax			(188,745)		(27,367)		(188,902)		216,269		(188,745)
Total stockholders' equity				4,626,150		1,511,334		5,015,979		(6,527,313)		4,626,150
Total liabilities and stockholders' equity			$	5,488,407	$	1,700,242	$	35,664,526	$	(7,103,842)	$	35,749,333

Condensed Consolidating Statement of Operations (Unaudited)
			Quarter ended June 30, 2014
							All other
		Popular, Inc.		PNA			subsidiaries and			Elimination			Popular, Inc.
(In thousands)		Holding Co.		Holding Co.			eliminations			entries			Consolidated
Interest income:
	Loans	$	498		$	-		$	380,966		$	(478)		$	380,986
	Money market investments		5			2			1,131			(7)			1,131
	Investment securities		165			81			33,743			-			33,989
	Trading account securities		-			-			5,344			-			5,344
	Total interest income		668			83			421,184			(485)			421,450
Interest expense:
	Deposits		-			-			26,226			(3)			26,223
	Short-term borrowings		-			89			9,285			(482)			8,892
	Long-term debt		440,133			2,706			2,877			-			445,716
	Total interest expense		440,133			2,795			38,388			(485)			480,831
Net interest (expense) income			(439,465)			(2,712)			382,796			-			(59,381)
Provision for loan losses- non-covered loans			32			-			50,042			-			50,074
Provision for loan losses- covered loans			-			-			11,604			-			11,604
Net interest (expense) income
	after provision for loan losses		(439,497)			(2,712)			321,150			-			(121,059)
Service charges on deposit accounts			-			-			39,237			-			39,237
Other service fees			-			-			57,719			(1,251)			56,468
Mortgage banking activities			-			-			3,788			-			3,788
Net gain and valuation adjustments on
Trading account profit			52			-			1,003			-			1,055
Net gain on sale of loans, including valuation
	adjustments on loans held-for-sale		-			-			9,659			-			9,659
Adjustments (expense) to indemnity reserves
	on loans sold		-			-			(7,454)			-			(7,454)
FDIC loss share (expense) income			-			-			(55,261)			-			(55,261)
Other operating income			3,108			(1,348)			13,537			-			15,297
	Total non-interest income (expense)		3,160			(1,348)			62,228			(1,251)			62,789
Operating expenses:
Personnel costs			8,201			-			90,899			-			99,100
Net occupancy expenses			1,013			-			19,254			-			20,267
Equipment expenses			1,079			-			10,965			-			12,044
Other taxes			176			-			13,367			-			13,543
Professional fees			2,266			(241)			65,053			(54)			67,024
Communications			122			-			6,303			-			6,425
Business promotion			439			-			15,599			-			16,038
FDIC deposit insurance			-			-			10,480			-			10,480
Other real estate owned (OREO) expenses			-			-			3,410			-			3,410
Other operating expenses			(15,251)			108			36,280			(628)			20,509
Amortization of intangibles			-			-			2,025			-			2,025
Restructuring cost			-			-			4,574			-			4,574
	Total operating expenses		(1,955)			(133)			278,209			(682)			275,439
(Loss) income before income tax and equity in
	earnings of subsidiaries		(434,382)			(3,927)			105,169			(569)			(333,709)
Income tax expense (benefit)			8,984			-			(12,887)			(221)			(4,124)
(Loss) income before equity in earnings of
	subsidiaries		(443,366)			(3,927)			118,056			(348)			(329,585)
Equity in undistributed earnings of
	subsidiaries		113,781			47,599			-			(161,380)			-
(Loss) income from continuing operations			(329,585)			43,672			118,056			(161,728)			(329,585)
Loss from discontinued opeartions, net of tax			-			-			(181,729)			-			(181,729)
Equity in undistributed losses of discontinued
	operations		(181,729)			(181,729)			-			363,458			-
Net Loss		$	(511,314)		$	(138,057)		$	(63,673)		$	201,730		$	(511,314)
Comprehensive loss, net of tax		$	(485,330)		$	(125,882)		$	(37,918)		$	163,800		$	(485,330)

Condensed Consolidating Statement of Operations
			Six months ended June 30, 2014
							All other
		Popular, Inc.		PNA			subsidiaries and			Elimination			Popular, Inc.
(In thousands)		Holding Co.		Holding Co.			eliminations			entries			Consolidated
Interest and dividend income:
	Loans		1,060			-			758,547			(1,019)			758,588
	Money market investments		12			5			2,103			(16)			2,104
	Investment securities		331			161			68,624			-			69,116
	Trading account securities		-			-			10,601			-			10,601
	Total interest and dividend income		1,403			166			839,875			(1,035)			840,409
Interest expense:
	Deposits		-			-			53,086			(5)			53,081
	Short-term borrowings		-			306			18,656			(1,030)			17,932
	Long-term debt		466,187			5,413			6,006			-			477,606
	Total interest expense		466,187			5,719			77,748			(1,035)			548,619
Net interest (expense) income			(464,784)			(5,553)			762,127			-			291,790
Provision for loan losses- non-covered loans			(176)			-			104,372			-			104,196
Provision for loan losses- covered loans			-			-			37,318			-			37,318
Net interest (expense) income
	after provision for loan losses		(464,608)			(5,553)			620,437			-			150,276
Service charges on deposit accounts			-			-			78,596			-			78,596
Other service fees			-			-			110,604			(1,318)			109,286
Mortgage banking activities			-			-			7,466			-			7,466
Net gain and valuation adjustments on
Trading account profit			73			-			2,959			-			3,032
Net gain on sale of loans, including valuation
	adjustments on loans held-for-sale		-			-			14,052			-			14,052
Adjustments (expense) to indemnity reserves
	on loans sold		-			-			(17,801)			-			(17,801)
FDIC loss share expense			-			-			(79,467)			-			(79,467)
Other operating income			6,509			(687)			37,835			-			43,657
	Total non-interest income		6,582			(687)			154,244			(1,318)			158,821
Operating expenses:
Personnel costs			16,510			-			186,891			-			203,401
Net occupancy expenses			1,945			-			39,682			-			41,627
Equipment expenses			2,020			-			21,436			-			23,456
Other taxes			360			-			26,846			-			27,206
Professional fees			5,312			763			128,069			(121)			134,023
Communications			249			-			12,861			-			13,110
Business promotion			850			-			26,574			-			27,424
FDIC deposit insurance			-			-			21,458			-			21,458
Other real estate owned (OREO) expenses			-			-			9,850			-			9,850
Other operating expenses			(29,019)			217			72,931			(1,271)			42,858
Amortization of intangibles			-			-			4,051			-			4,051
Restructuring costs			-			-			4,574			-			4,574
	Total operating expenses		(1,773)			980			555,223			(1,392)			553,038
Loss (income) before income tax
	and equity in earnings of subsidiaries		(456,253)			(7,220)			219,458			74			(243,941)
Income tax expense			8,150			-			10,960			30			19,140
Loss (income) before equity in
	earnings of subsidiaries		(464,403)			(7,220)			208,498			44			(263,081)
Equity in undistributed earnings of
	subsidiaries		201,322			65,291			-			(266,613)			-
Income from continuing operations			(263,081)			58,071			208,498			(266,569)			(263,081)
Loss from discontinued operations, net of tax			-			-			(161,824)			-			(161,824)
Equity in undistributed losses of
	discontinued operations		(161,824)			(161,824)			-			323,648			-
Net (Loss) Income		$	(424,905)		$	(103,753)		$	46,674		$	57,079		$	(424,905)
Comprehensive (loss) income , net of tax		$	(366,451)		$	(80,011)		$	106,214		$	(26,203)		$	(366,451)

Condensed Consolidating Statement of Operations (Unaudited)
				Quarter ended June 30, 2013
								All other
		Popular, Inc.			PNA			subsidiaries and			Elimination			Popular, Inc.
(In thousands)		Holding Co.			Holding Co.			eliminations			entries			Consolidated
Interest income:
	Loans		$	1,917		$	-		$	368,636		$	(255)		$	370,298
	Money market investments			48			1			828			(48)			829
	Investment securities			3,397			80			35,542			(2,913)			36,106
	Trading account securities			-			-			5,456			-			5,456
	Total interest income			5,362			81			410,462			(3,216)			412,689
Interest expense:
	Deposits			-			-			32,445			-			32,445
	Short-term borrowings			-			-			10,071			(304)			9,767
	Long-term debt			25,099			7,238			6,641			(2,912)			36,066
	Total interest expense			25,099			7,238			49,157			(3,216)			78,278
Net interest (expense) income				(19,737)			(7,157)			361,305			-			334,411
Provision for loan losses- non-covered loans				20			-			228,955			-			228,975
Provision for loan losses- covered loans				-			-			25,500			-			25,500
Net interest (expense) income
	after provision for loan losses			(19,757)			(7,157)			106,850			-			79,936
Service charges on deposit accounts				-			-			41,378			-			41,378
Other service fees				-			-			58,617			(1,338)			57,279
Mortgage banking activities				-			-			18,081			-			18,081
Net gain and valuation adjustments on
	investment securities			5,856			-			-			-			5,856
Trading account loss				(6)			-			(4,339)			-			(4,345)
Net gain on sale of loans, including valuation
	adjustments on loans held-for-sale			-			-			4,291			-			4,291
Adjustments (expense) to indemnity reserves
	on loans sold			-			-			(11,632)			-			(11,632)
FDIC loss share expense				-			-			(3,755)			-			(3,755)
Other operating income				166,002			287			15,277			(1)			181,565
	Total non-interest income			171,852			287			117,918			(1,339)			288,718
Operating expenses:
Personnel costs				7,761			-			98,598			-			106,359
Net occupancy expenses				918			1			20,140			-			21,059
Equipment expenses				984			-			10,501			-			11,485
Other taxes				84			-			15,141			-			15,225
Professional fees				3,383			23			63,663			(54)			67,015
Communications				110			-			6,285			-			6,395
Business promotion				439			-			14,918			-			15,357
FDIC deposit insurance				-			-			18,557			-			18,557
Other real estate owned (OREO) expenses				-			-			7,657			-			7,657
Other operating expenses				(12,734)			109			36,027			(636)			22,766
Amortization of intangibles				-			-			1,989			-			1,989
	Total operating expenses			945			133			293,476			(690)			293,864
Income (loss) before income tax
	and equity in earnings of subsidiaries			151,150			(7,003)			(68,708)			(649)			74,790
Income tax expense (benefit)				3,106			-			(240,194)			(292)			(237,380)
Income (loss) before equity in earnings of subsidiaries				148,044			(7,003)			171,486			(357)			312,170
Equity in undistributed earnings
	of subsidiaries			164,126			12,158			-			(176,284)			-
Income from continuing operations				312,170			5,155			171,486			(176,641)			312,170
Income from discontinued operations, net of tax				-			-			15,298			-			15,298
Equity in undistributed earnings of
	discontinued operations			15,298			15,298			-			(30,596)			-
Net Income			$	327,468		$	20,453		$	186,784		$	(207,237)		$	327,468
Comprehensive income (loss), net of tax			$	223,437		$	(24,121)		$	86,748		$	(62,627)		$	223,437

Condensed Consolidating Statement of Operations
			Six months ended June 30, 2013
							All other
		Popular, Inc.		PNA			subsidiaries and			Elimination			Popular, Inc.
(In thousands)		Holding Co.		Holding Co.			eliminations			entries			Consolidated
Interest and dividend income:
	Loans		2,926			-			728,275			(387)			730,814
	Money market investments		86			2			1,783			(87)			1,784
	Investment securities		7,543			161			72,049			(5,824)			73,929
	Trading account securities		-			-			10,970			-			10,970
	Total interest and dividend income		10,555			163			813,077			(6,298)			817,497
Interest expense:
	Deposits		-			-			67,063			(2)			67,061
	Short-term borrowings		-			-			20,020			(472)			19,548
	Long-term debt		49,857			14,514			13,286			(5,824)			71,833
	Total interest expense		49,857			14,514			100,369			(6,298)			158,442
Net interest (expense) income			(39,302)			(14,351)			712,708			-			659,055
Provision for loan losses- non-covered loans			(20)			-			438,088			-			438,068
Provision for loan losses- covered loans			-			-			43,056			-			43,056
Net interest (expense) income
	after provision for loan losses		(39,282)			(14,351)			231,564			-			177,931
Service charges on deposit accounts			-			-			82,539			-			82,539
Other service fees			-			-			113,622			(1,399)			112,223
Mortgage banking activities			-			-			38,378			-			38,378
Net gain and valuation adjustments on
	investment securities		5,856			-			-			-			5,856
Trading account profit (loss)			70			-			(5,399)			-			(5,329)
Net loss on sale of loans, including valuation
	adjustments on loans held-for-sale		-			-			(58,428)			-			(58,428)
Adjustments (expense) to indemnity reserves
	on loans sold		-			-			(27,775)			-			(27,775)
FDIC loss share expense			-			-			(30,021)			-			(30,021)
Other operating income			166,872			2,849			31,864			-			201,585
	Total non-interest income		172,798			2,849			144,780			(1,399)			319,028
Operating expenses:
Personnel costs			15,140			-			198,800			-			213,940
Net occupancy expenses			1,746			2			39,803			-			41,551
Equipment expenses			2,064			-			21,041			-			23,105
Other taxes			167			-			26,586			-			26,753
Professional fees			5,694			45			129,128			(115)			134,752
Communications			203			-			12,743			-			12,946
Business promotion			869			-			27,073			-			27,942
FDIC deposit insurance			-			-			26,913			-			26,913
Other real estate owned (OREO) expenses			-			-			53,524			-			53,524
Other operating expenses			(25,349)			217			70,069			(1,253)			43,684
Amortization of intangibles			-			-			3,979			-			3,979
	Total operating expenses		534			264			609,659			(1,368)			609,089
Income (loss) before income tax
	and equity in earnings of subsidiaries		132,982			(11,766)			(233,315)			(31)			(112,130)
Income tax expense (benefit)			3,621			-			(297,771)			(107)			(294,257)
Income (loss) before equity in
	earnings of subsidiaries		129,361			(11,766)			64,456			76			182,127
Equity in undistributed earnings of subsidiaries			52,766			16,368			-			(69,134)			-
Income from continuing operations			182,127			4,602			64,456			(69,058)			182,127
Income from discontinued operations, net of tax			-			-			25,034			-			25,034
Equity in undistributed losses of
	discontinued operations		25,034			25,034			-			(50,068)			-
Net Income		$	207,161		$	29,636		$	89,490		$	(119,126)		$	207,161
Comprehensive income (loss), net of tax		$	83,990		$	(21,965)		$	(32,286)		$	54,251		$	83,990

Condensed ConsolidatingStatementof Cash Flows (Unaudited)

						Six months ended June 30, 2014
										All other
						Popular, Inc.		PNA		subsidiaries		Elimination		Popular, Inc.
(In thousands)						Holding Co.		Holding Co.		and eliminations		entries		Consolidated
Cash flows from operating activities:
Net (loss) income					$	(424,905)	$	(103,753)	$	46,674	$	57,079	$	(424,905)
Adjustments to reconcile net (loss) income to net
	cash (used in) provided by operating activities:
	Equity in undistributed (earnings) losses of subsidiaries					(39,498)		96,533		-		(57,035)		-
	Provision for loan losses					(176)		-		134,926		-		134,750
	Goodwill impairment losses					-		-		186,511		-		186,511
	Amortization of intangibles					-		-		5,007		-		5,007
	Depreciation and amortization of premises and
		equipment				325		-		23,507		-		23,832
	Net accretion of discounts and amortization
		of premiums and deferred fees				404,461		-		(79,682)		-		324,779
	Fair value adjustments on mortgage servicing rights					-		-		15,836		-		15,836
	FDIC loss share expense					-		-		79,467		-		79,467
	Adjustments (expense) to indemnity reserves on
		loans sold				-		-		17,801		-		17,801
	(Earnings) losses from investments under the
		equity method				(6,509)		688		(18,534)		-		(24,355)
	Deferred income tax expense (benefit)					8,150		-		(5,491)		30		2,689
	Loss (gain) on:
			Disposition of premises and equipment			(1)		-		(2,550)		-		(2,551)
			Sale of loans, including valuation adjustments on
				loans held for sale and mortgage banking activities		-		-		(42,413)		-		(42,413)
			Sale of foreclosed assets, including write-downs			-		-		(2,035)		-		(2,035)
	Acquisitions of loans held-for-sale					-		-		(159,727)		-		(159,727)
	Proceeds from sale of loans held-for-sale					-		-		72,757		-		72,757
	Net originations on loans held-for-sale					-		-		(338,672)		-		(338,672)
	Net (increase) decrease in:
			Trading securities			(224)		-		460,016		-		459,792
			Accrued income receivable			(68)		2		6,725		62		6,721
			Other assets			9,592		(7,095)		(25,477)		(25,475)		(48,455)
	Net increase (decrease) in:
			Interest payable			2,080		5		(1,390)		(62)		633
			Pension and other postretirement benefits
				obligations		-		-		(3,096)		-		(3,096)
			Other liabilities			(4,312)		(32,031)		41,202		25,401		30,260
Total adjustments						373,820		58,102		364,688		(57,079)		739,531
Net cash (used in) provided by operating activities						(51,085)		(45,651)		411,362		-		314,626
Cash flows from investing activities:
	Net (increase) decrease in money market investments					(1,014)		4,204		(808,477)		(3,204)		(808,491)
	Purchases of investment securities:
			Available-for-sale			-		-		(1,079,586)		-		(1,079,586)
			Other			-		-		(51,097)		-		(51,097)
	Proceeds from calls, paydowns, maturities and
		redemptions of investment securities:
			Available-for-sale			-		-		816,830		-		816,830
			Held-to-maturity			-		-		27,029		-		27,029
			Other			-		-		64,724		-		64,724
	Net (originations) repayments on loans					(67,240)		-		473,634		66,942		473,336
	Proceeds from sale of loans					-		-		87,983		-		87,983
	Acquisition of loan portfolios					-		-		(289,292)		-		(289,292)
	Net payments from FDIC under loss sharing
		agreements				-		-		110,618		-		110,618
	Capital contribution to subsidiary					(100,000)		-		-		100,000		-
	Return of capital from wholly-owned subsidiaries					210,000		250,000		-		(460,000)		-
	Acquisition of premises and equipment					(352)		-		(19,981)		-		(20,333)
	Proceeds from sale of:
			Premises and equipment			24		-		8,607		-		8,631
			Foreclosed assets			-		-		81,010		-		81,010
Net cash provided by (used in) investing activities						41,418		254,204		(577,998)		(296,262)		(578,638)
Cash flows from financing activities:
	Net increase (decrease) in:
			Deposits			-		-		241,260		11,455		252,715
			Federal funds purchased and assets sold
				under agreements to repurchase		-		-		418,381		-		418,381
			Other short-term borrowings			-		1,443		(304,500)		(66,943)		(370,000)
	Payments of notes payable					-		-		(111,030)		-		(111,030)
	Proceeds from issuance of notes payable					-		-		31,905		-		31,905
	Proceeds from issuance of common stock					3,048		-		-		-		3,048
	Dividends paid					(1,862)		-		-		-		(1,862)
	Net payments for repurchase of common stock					(861)		-		-		-		(861)
	Return of capital to parent company					-		(210,000)		(250,000)		460,000		-
	Capital contribution from parent					-		-		100,000		(100,000)		-
Net cash provided by (used in) financing activities						325		(208,557)		126,016		304,512		222,296
Net decrease in cash and due from banks						(9,342)		(4)		(40,620)		8,250		(41,716)
Cash and due from banks at beginning of period						10,595		616		422,967		(10,967)		423,211
Cash and due from banks at end of period,
	including discontinued operations					1,253		612		382,347		(2,717)		381,495
Less: cash from discontinued operations						-		-		18,923		-		18,923
Cash and due from banks at end of period					$	1,253	$	612	$	363,424	$	(2,717)	$	362,572
The Condensed Consolidating Statements of Cash Flows include the cash flows from operating, investing and financing activities associated with discontinued operations.

Condensed Consolidating Statementof Cash Flows

						Six months ended June 30, 2013
										All other
						Popular, Inc.		PNA		subsidiaries		Elimination		Popular, Inc.
(In thousands)						Holding Co.		Holding Co.		and eliminations		entries		Consolidated
Cash flows from operating activities:
Net income (loss)					$	207,161	$	29,636	$	89,490	$	(119,126)	$	207,161
Adjustments to reconcile net income (loss) to net
	cash (used in) provided by operating activities:
	Equity in undistributed earnings of subsidiaries					(77,800)		(41,402)		-		119,202		-
	Provision for loan losses					(20)		-		473,284		-		473,264
	Amortization of intangibles					-		-		4,935		-		4,935
	Depreciation and amortization of premises and
		equipment				323		2		24,684		-		25,009
	Net accretion of discounts and amortization
		of premiums and deferred fees				14,989		38		(44,552)		-		(29,525)
	Fair value adjustments on mortgage servicing rights					-		-		10,741		-		10,741
	FDIC loss share expense					-		-		30,021		-		30,021
	Adjustments (expense) to indemnity reserves on
		loans sold				-		-		27,775		-		27,775
	Earnings from investments under the equity
		method				(20,297)		(2,849)		(11,068)		-		(34,214)
	Deferred income tax benefit					(9,098)		-		(312,649)		(107)		(321,854)
	(Gain) loss on:
			Disposition of premises and equipment			-		-		(2,347)		-		(2,347)
			Sale of loans, including valuation adjustments on
				loans held for sale and mortgage banking activities		-		-		44,577		-		44,577
			Sale of stock in equity method investee			(136,722)		-		-		-		(136,722)
			Sale of foreclosed assets, including write-downs			-		-		35,006		-		35,006
	Acquisitions of loans held-for-sale					-		-		(15,335)		-		(15,335)
	Proceeds from sale of loans held-for-sale					-		-		119,003		-		119,003
	Net originations on loans held-for-sale					-		-		(867,917)		-		(867,917)
	Net (increase) decrease in:
			Trading securities			(166)		-		858,258		-		858,092
			Accrued income receivable			1,583		-		(19,475)		(285)		(18,177)
			Other assets			(3,505)		100		4,199		1,309		2,103
	Net increase (decrease) in:
			Interest payable			-		(7)		(2,533)		(30)		(2,570)
			Pension and other postretirement benefits
				obligations		-		-		3,786		-		3,786
			Other liabilities			(2,165)		(9)		7,192		(963)		4,055
Total adjustments						(232,878)		(44,127)		367,585		119,126		209,706
Net cash (used in) provided by operating activities						(25,717)		(14,491)		457,075		-		416,867
Cash flows from investing activities:
	Net (increase) decrease in money market investments					(21,914)		(251)		13,755		22,051		13,641
	Purchases of investment securities:
			Available-for-sale			-		-		(1,490,647)		-		(1,490,647)
			Held-to-maturity			-		-		-		-		-
			Other			-		-		(116,731)		-		(116,731)
	Proceeds from calls, paydowns, maturities and
		redemptions of investment securities:
			Available-for-sale			35,000		-		1,343,311		-		1,378,311
			Held-to-maturity			-		-		2,359		-		2,359
			Other			-		-		83,592		-		83,592
	Net (originations) repayments on loans					(137,255)		-		568,817		192,700		624,262
	Proceeds from sale of loans					-		-		295,237		-		295,237
	Acquisition of loan portfolios					-		-		(1,520,088)		-		(1,520,088)
	Net payments to FDIC under loss sharing
		agreements				-		-		(107)		-		(107)
	Return of capital from equity method investments					-		438		-		-		438
	Proceeds from sale of sale of stock in
		equity method investee				166,332		-		-		-		166,332
	Capital contribution to subsidiary					(17,300)		-		-		17,300		-
	Mortgage servicing rights purchased					-		-		(45)		-		(45)
	Acquisition of premises and equipment					(198)		-		(19,576)		-		(19,774)
	Proceeds from sale of:
			Premises and equipment			28		-		5,863		-		5,891
			Foreclosed assets			-		-		120,365		-		120,365
Net cash provided by (used in) investing activities						24,693		187		(713,895)		232,051		(456,964)
Cash flows from financing activities:
	Net increase (decrease) in:
			Deposits			-		-		(259,645)		(305)		(259,950)
			Assets sold under agreements to
				repurchase		-		-		(322,247)		(21,800)		(344,047)
			Other short-term borrowings			-		-		782,700		(192,700)		590,000
	Payments of notes payable					-		(3,000)		(45,458)		-		(48,458)
	Proceeds from issuance of notes payable					-		-		49,874		-		49,874
	Proceeds from issuance of common stock					3,232		-		-		-		3,232
	Dividends paid					(1,551)		-		-		-		(1,551)
	Net payments for repurchase of common stock					(325)		-		-		-		(325)
	Capital contribution from parent					-		17,300		-		(17,300)		-
Net cash provided by (used in) financing activities						1,356		14,300		205,224		(232,105)		(11,225)
Net increase (decrease) in cash and due from banks						332		(4)		(51,596)		(54)		(51,322)
Cash and due from banks at beginning of period						1,103		624		439,552		(1,916)		439,363
Cash and due from banks at end of period					$	1,435	$	620	$	387,956	$	(1,970)	$	388,041
The Condensed Consolidating Statements of Cash Flows include the cash flows from operating, investing and financing activities associated with discontinued operations.