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Allowance for loan losses
 12 Months Ended
Dec. 31, 2019
Receivables  
Allowance for loan losses Note 9 – Allowance for loan losses

The Corporation follows a systematic methodology to establish and evaluate the adequacy of the allowance for loan losses (“ALLL”) to provide for inherent losses in the loan portfolio. This methodology includes the consideration of factors such as current economic conditions, portfolio risk characteristics, prior loss experience and results of periodic credit reviews of individual loans. The provision for loan losses charged to current operations is based on this methodology. Loan losses are charged and recoveries are credited to the ALLL.

The Corporation’s assessment of the ALLL is determined in accordance with the guidance of loss contingencies in ASC Subtopic 450-20 and loan impairment guidance in ASC Section 310-10-35. Also, the Corporation determines the ALLL on purchased impaired loans and purchased loans accounted for under ASC Subtopic 310-30, by evaluating decreases in expected cash flows after the acquisition date.

The accounting guidance provides for the recognition of a loss allowance for groups of homogeneous loans. The determination of the general ALLL includes the following principal factors:

Base net loss rates, which are based on the moving average of annualized net loss rates computed over a 5-year historical loss period for the commercial and construction loan portfolios, and an 18-month period for the consumer and mortgage loan portfolios. The base net loss rates are applied by loan type and by legal entity.

 

Recent loss trend adjustment, which replaces the base loss rate with a 12-month average loss rate, when these trends are higher than the respective base loss rates. The objective of this adjustment is to allow for a more recent loss trend to be captured and reflected in the ALLL estimation process.

 

For the period ended December 31, 2019, 25% (December 31, 2018 - 26%) of the ALLL for the BPPR segment loan portfolios utilized the recent loss trend adjustment instead of the base loss. The effect of replacing the base loss with the recent loss trend adjustment was mainly concentrated in the leasing, auto and commercial real estate non-owner occupied portfolios for 2019 and in the commercial, mortgage, and overall consumer portfolios for 2018.

 

For the period ended December 31, 2019, 21% (December 31, 2018 - 28 %) of the Popular U.S. segment loan portfolios utilized the recent loss trend adjustment instead of the base loss. The effect of replacing the base loss with the recent loss trend adjustment was concentrated in the commercial multi-family, legacy, commercial real estate owner occupied and construction portfolios for 2019 and in the consumer portfolio for 2018.

 

Environmental factors, which include credit and macroeconomic indicators such as unemployment rate, economic activity index and delinquency rates, adopted to account for current market conditions that are likely to cause estimated credit losses to differ from historical losses. The Corporation reflects the effect of these environmental factors on each loan group as an adjustment that, as appropriate, increases the historical loss rate applied to each group. Environmental factors provide updated perspective on credit and economic conditions. Regression analysis is used to select these indicators and quantify the effect on the general ALLL. The Corporation’s methodology also includes qualitative judgmental reserves based on stressed credit quality assumptions to provide for probable losses in the loan portfolios not embedded in the historical loss rates.

During the third quarter of 2019, management completed the recalibration analysis of the environmental factors adjustments. The environmental factors adjustments are developed by performing regression analyses on selected credit and economic indicators for each applicable loan segment. The environmental factor models used to account for changes in current credit and macroeconomic conditions were reviewed and recalibrated based on the latest applicable trends.

 

The effect of the recalibration resulted in an increase of $4.6 million to the environmental factors adjustments reserve at the Popular U.S. segment.

The following tables present the changes in the allowance for loan losses, loan ending balances and whether such loans and the allowance pertain to loans individually or collectively evaluated for impairment for the years ended December 31, 2019 and 2018.

For the year ended December 31, 2019

Puerto Rico

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

 

Construction

 

Mortgage

 

Leasing

 

Consumer

 

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

207,214

 

$

886

 

$

142,978

 

$

11,486

 

$

144,594

 

$

507,158

 

Provision (reversal of provision)

 

(41,440)

 

 

(3,417)

 

 

14,658

 

 

8,619

 

 

157,331

 

 

135,751

 

Charge-offs

 

(53,852)

 

 

(109)

 

 

(47,577)

 

 

(11,834)

 

 

(167,983)

 

 

(281,355)

 

Recoveries

 

19,141

 

 

3,214

 

 

6,222

 

 

2,497

 

 

40,023

 

 

71,097

Ending balance

$

131,063

 

$

574

 

$

116,281

 

$

10,768

 

$

173,965

 

$

432,651

Specific ALLL

$

20,533

 

$

6

 

$

40,596

 

$

61

 

$

20,259

 

$

81,455

General ALLL

$

110,530

 

$

568

 

$

75,685

 

$

10,707

 

$

153,706

 

$

351,196

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

$

397,452

 

$

119

 

$

522,469

 

$

507

 

$

91,157

 

$

1,011,704

Loans held-in-portfolio excluding impaired loans

 

6,863,678

 

 

137,351

 

 

5,644,279

 

 

1,059,000

 

 

5,464,220

 

 

19,168,528

Total loans held-in-portfolio

$

7,261,130

 

$

137,470

 

$

6,166,748

 

$

1,059,507

 

$

5,555,377

 

$

20,180,232

For the year ended December 31, 2019

Popular U.S.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

 

Construction

 

Mortgage

 

Legacy

 

Consumer

 

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

31,901

 

$

6,538

 

$

4,434

 

$

969

 

$

18,348

 

$

62,190

 

Provision (reversal of provision)

 

15,496

 

 

(127)

 

 

828

 

 

(1,738)

 

 

15,569

 

 

30,028

 

Charge-offs

 

(40,329)

 

 

(2,215)

 

 

(605)

 

 

105

 

 

(21,280)

 

 

(64,324)

 

Recoveries

 

8,921

 

 

8

 

 

170

 

 

1,294

 

 

6,770

 

 

17,163

Ending balance

$

15,989

 

$

4,204

 

$

4,827

 

$

630

 

$

19,407

 

$

45,057

Specific ALLL

$

-

 

$

-

 

$

2,208

 

$

-

 

$

1,563

 

$

3,771

General ALLL

$

15,989

 

$

4,204

 

$

2,619

 

$

630

 

$

17,844

 

$

41,286

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

$

2,097

 

$

-

 

$

9,386

 

$

-

 

$

9,634

 

$

21,117

Loans held-in-portfolio excluding impaired loans

 

5,049,524

 

 

693,622

 

 

1,007,398

 

 

22,105

 

 

432,875

 

 

7,205,524

Total loans held-in-portfolio

$

5,051,621

 

$

693,622

 

$

1,016,784

 

$

22,105

 

$

442,509

 

$

7,226,641

For the year ended December 31, 2019

Popular, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

 

Construction

 

Mortgage

 

Legacy

Leasing

 

Consumer

 

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

239,115

 

$

7,424

 

$

147,412

 

$

969

$

11,486

 

$

162,942

 

$

569,348

 

Provision (reversal of provision)

 

(25,944)

 

 

(3,544)

 

 

15,486

 

 

(1,738)

 

8,619

 

 

172,900

 

 

165,779

 

Charge-offs

 

(94,181)

 

 

(2,324)

 

 

(48,182)

 

 

105

 

(11,834)

 

 

(189,263)

 

 

(345,679)

 

Recoveries

 

28,062

 

 

3,222

 

 

6,392

 

 

1,294

 

2,497

 

 

46,793

 

 

88,260

Ending balance

$

147,052

 

$

4,778

 

$

121,108

 

$

630

$

10,768

 

$

193,372

 

$

477,708

Specific ALLL

$

20,533

 

$

6

 

$

42,804

 

$

-

$

61

 

$

21,822

 

$

85,226

General ALLL

$

126,519

 

$

4,772

 

$

78,304

 

$

630

$

10,707

 

$

171,550

 

$

392,482

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

$

399,549

 

$

119

 

$

531,855

 

$

-

$

507

 

$

100,791

 

$

1,032,821

Loans held-in-portfolio excluding impaired loans

 

11,913,202

 

 

830,973

 

 

6,651,677

 

 

22,105

 

1,059,000

 

 

5,897,095

 

 

26,374,052

Total loans held-in-portfolio

$

12,312,751

 

$

831,092

 

$

7,183,532

 

$

22,105

$

1,059,507

 

$

5,997,886

 

$

27,406,873

For the year ended December 31, 2018

Puerto Rico - Non-covered loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

 

Construction

 

Mortgage

 

Leasing

 

Consumer

 

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

171,531

 

$

1,286

 

$

159,081

 

$

11,991

 

$

174,215

 

$

518,104

 

Provision (reversal of provision)

 

101,614

 

 

(1,754)

 

 

15,297

 

 

5,525

 

 

75,779

 

 

196,461

 

Charge-offs

 

(82,352)

 

 

(9)

 

 

(69,393)

 

 

(8,297)

 

 

(138,161)

 

 

(298,212)

 

Recoveries

 

16,421

 

 

1,363

 

 

4,571

 

 

2,267

 

 

32,573

 

 

57,195

 

Allowance transferred from covered loans

 

-

 

 

-

 

 

33,422

 

 

-

 

 

188

 

 

33,610

Ending balance

$

207,214

 

$

886

 

$

142,978

 

$

11,486

 

$

144,594

 

$

507,158

Specific ALLL

$

52,190

 

$

56

 

$

38,760

 

$

320

 

$

24,083

 

$

115,409

General ALLL

$

155,024

 

$

830

 

$

104,218

 

$

11,166

 

$

120,511

 

$

391,749

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired non-covered loans

$

398,518

 

$

1,788

 

$

509,468

 

$

1,099

 

$

104,235

 

$

1,015,108

Non-covered loans held-in-portfolio excluding impaired loans

 

6,974,125

 

 

84,167

 

 

5,923,855

 

 

933,674

 

 

4,952,543

 

 

18,868,364

Total non-covered loans held-in-portfolio

$

7,372,643

 

$

85,955

 

$

6,433,323

 

$

934,773

 

$

5,056,778

 

$

19,883,472

For the year ended December 31, 2018

Puerto Rico - Covered Loans

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

 

Construction

 

Mortgage

 

Leasing

 

Consumer

 

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

-

 

$

-

 

$

32,521

 

$

-

 

$

723

 

$

33,244

 

Provision (reversal of provision)

 

-

 

 

-

 

 

2,265

 

 

-

 

 

(535)

 

 

1,730

 

Charge-offs

 

-

 

 

-

 

 

(1,446)

 

 

-

 

 

(2)

 

 

(1,448)

 

Recoveries

 

-

 

 

-

 

 

82

 

 

-

 

 

2

 

 

84

 

Allowance transferred to non-covered loans

 

-

 

 

-

 

 

(33,422)

 

 

-

 

 

(188)

 

 

(33,610)

Ending balance

$

-

 

$

-

 

$

-

 

$

-

 

$

-

 

$

-

Specific ALLL

$

-

 

$

-

 

$

-

 

$

-

 

$

-

 

$

-

General ALLL

$

-

 

$

-

 

$

-

 

$

-

 

$

-

 

$

-

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired covered loans

$

-

 

$

-

 

$

-

 

$

-

 

$

-

 

$

-

Covered loans held-in-portfolio excluding impaired loans

 

-

 

 

-

 

 

-

 

 

-

 

 

-

 

 

-

Total covered loans held-in-portfolio

$

-

 

$

-

 

$

-

 

$

-

 

$

-

 

$

-

For the year ended December 31, 2018

Popular U.S.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

 

Construction

 

Mortgage

 

Legacy

 

Consumer

 

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

44,134

 

$

7,076

 

$

4,541

 

$

798

 

$

15,529

 

$

72,078

 

Provision (reversal of provision)

 

7,551

 

 

5,268

 

 

(478)

 

 

(1,861)

 

 

19,401

 

 

29,881

 

Charge-offs

 

(24,920)

 

 

(5,806)

 

 

(232)

 

 

114

 

 

(22,118)

 

 

(52,962)

 

Recoveries

 

5,136

 

 

-

 

 

603

 

 

1,918

 

 

5,536

 

 

13,193

Ending balance

$

31,901

 

$

6,538

 

$

4,434

 

$

969

 

$

18,348

 

$

62,190

Specific ALLL

$

-

 

$

-

 

$

2,451

 

$

-

 

$

1,810

 

$

4,261

General ALLL

$

31,901

 

$

6,538

 

$

1,983

 

$

969

 

$

16,538

 

$

57,929

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

$

-

 

$

12,060

 

$

9,420

 

$

-

 

$

8,507

 

$

29,987

Loans held-in-portfolio excluding impaired loans

 

4,670,376

 

 

681,434

 

 

792,515

 

 

25,949

 

 

424,156

 

 

6,594,430

Total loans held-in-portfolio

$

4,670,376

 

$

693,494

 

$

801,935

 

$

25,949

 

$

432,663

 

$

6,624,417

For the year ended December 31, 2018

Popular, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

Commercial

Construction

Mortgage

Legacy

Leasing

Consumer

Total

Allowance for credit losses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Beginning balance

$

215,665

$

8,362

$

196,143

$

798

$

11,991

$

190,467

$

623,426

 

Provision (reversal of provision)

 

109,165

 

3,514

 

17,084

 

(1,861)

 

5,525

 

94,645

 

228,072

 

Charge-offs

 

(107,272)

 

(5,815)

 

(71,071)

 

114

 

(8,297)

 

(160,281)

 

(352,622)

 

Recoveries

 

21,557

 

1,363

 

5,256

 

1,918

 

2,267

 

38,111

 

70,472

Ending balance

$

239,115

$

7,424

$

147,412

$

969

$

11,486

$

162,942

$

569,348

Specific ALLL

$

52,190

$

56

$

41,211

$

-

$

320

$

25,893

$

119,670

General ALLL

$

186,925

$

7,368

$

106,201

$

969

$

11,166

$

137,049

$

449,678

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impaired loans

$

398,518

$

13,848

$

518,888

$

-

$

1,099

$

112,742

$

1,045,095

Loans held-in-portfolio excluding impaired loans

 

11,644,501

 

765,601

 

6,716,370

 

25,949

 

933,674

 

5,376,699

 

25,462,794

Total loans held-in-portfolio

$

12,043,019

$

779,449

$

7,235,258

$

25,949

$

934,773

$

5,489,441

$

26,507,889

The following table provides the activity in the allowance for loan losses related to loans accounted for pursuant to ASC Subtopic 310-30.

 

ASC 310-30

 

For the years ended

(In thousands)

December 31, 2019

 

December 31, 2018

Balance at beginning of period

$

122,135

 

$

119,505

Provision

 

1,119

 

 

61,270

Net charge-offs

 

(49,215)

 

 

(58,640)

Balance at end of period

$

74,039

 

$

122,135

Impaired loans

The following tables present loans individually evaluated for impairment at December 31, 2019 and 2018.

December 31, 2019

Puerto Rico

 

Impaired Loans – With an

Impaired Loans

 

 

 

 

 

 

 

Allowance

With No Allowance

Impaired Loans - Total

 

 

 

Unpaid

 

 

 

 

Unpaid

 

 

Unpaid

 

 

 

Recorded

principal

Related

Recorded

principal

Recorded

principal

 

Related

(In thousands)

investment

balance

allowance

investment

balance

investment

balance

 

allowance

Commercial multi-family

$

1,196

$

1,229

$

4

$

1,017

$

1,247

$

2,213

$

2,476

$

4

Commercial real estate non-owner occupied

 

44,975

 

45,803

 

12,281

 

149,587

 

173,124

 

194,562

 

218,927

 

12,281

Commercial real estate owner occupied

 

105,841

 

122,814

 

5,077

 

26,365

 

58,540

 

132,206

 

181,354

 

5,077

Commercial and industrial

 

43,640

 

47,611

 

3,171

 

24,831

 

44,255

 

68,471

 

91,866

 

3,171

Construction

 

119

 

119

 

6

 

-

 

-

 

119

 

119

 

6

Mortgage

 

420,949

 

479,936

 

40,596

 

101,520

 

134,331

 

522,469

 

614,267

 

40,596

Leasing

 

507

 

507

 

61

 

-

 

-

 

507

 

507

 

61

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

24,475

 

24,475

 

2,957

 

-

 

-

 

24,475

 

24,475

 

2,957

Personal

 

65,521

 

65,521

 

17,142

 

-

 

-

 

65,521

 

65,521

 

17,142

Auto

 

310

 

310

 

51

 

-

 

-

 

310

 

310

 

51

Other

 

851

 

851

 

109

 

-

 

-

 

851

 

851

 

109

Total Puerto Rico

$

708,384

$

789,176

$

81,455

$

303,320

$

411,497

$

1,011,704

$

1,200,673

$

81,455

December 31, 2019

Popular U.S.

 

Impaired Loans – With an

Impaired Loans

 

 

 

 

 

 

 

Allowance

With No Allowance

Impaired Loans - Total

 

 

 

Unpaid

 

 

 

 

Unpaid

 

 

Unpaid

 

 

 

Recorded

principal

Related

Recorded

principal

Recorded

principal

Related

(In thousands)

investment

balance

allowance

investment

balance

investment

balance

allowance

Commercial multi-family

$

-

$

-

$

-

$

2,097

$

2,539

$

2,097

$

2,539

$

-

Mortgage

 

6,906

 

7,257

 

2,208

 

2,480

 

2,844

 

9,386

 

10,101

 

2,208

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HELOCs

 

6,691

 

6,691

 

1,560

 

2,829

 

3,087

 

9,520

 

9,778

 

1,560

Personal

 

26

 

26

 

3

 

88

 

88

 

114

 

114

 

3

Total Popular U.S.

$

13,623

$

13,974

$

3,771

$

7,494

$

8,558

$

21,117

$

22,532

$

3,771

December 31, 2019

Popular, Inc.

 

Impaired Loans – With an

Impaired Loans

 

 

 

 

 

 

 

Allowance

With No Allowance

Impaired Loans - Total

 

 

 

Unpaid

 

 

 

 

Unpaid

 

 

Unpaid

 

 

 

Recorded

principal

Related

Recorded

principal

Recorded

principal

Related

(In thousands)

investment

balance

allowance

investment

balance

investment

balance

allowance

Commercial multi-family

$

1,196

$

1,229

$

4

$

3,114

$

3,786

$

4,310

$

5,015

$

4

Commercial real estate non-owner occupied

 

44,975

 

45,803

 

12,281

 

149,587

 

173,124

 

194,562

 

218,927

 

12,281

Commercial real estate owner occupied

 

105,841

 

122,814

 

5,077

 

26,365

 

58,540

 

132,206

 

181,354

 

5,077

Commercial and industrial

 

43,640

 

47,611

 

3,171

 

24,831

 

44,255

 

68,471

 

91,866

 

3,171

Construction

 

119

 

119

 

6

 

-

 

-

 

119

 

119

 

6

Mortgage

 

427,855

 

487,193

 

42,804

 

104,000

 

137,175

 

531,855

 

624,368

 

42,804

Leasing

 

507

 

507

 

61

 

-

 

-

 

507

 

507

 

61

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

24,475

 

24,475

 

2,957

 

-

 

-

 

24,475

 

24,475

 

2,957

HELOCs

 

6,691

 

6,691

 

1,560

 

2,829

 

3,087

 

9,520

 

9,778

 

1,560

Personal

 

65,547

 

65,547

 

17,145

 

88

 

88

 

65,635

 

65,635

 

17,145

Auto

 

310

 

310

 

51

 

-

 

-

 

310

 

310

 

51

Other

 

851

 

851

 

109

 

-

 

-

 

851

 

851

 

109

Total Popular, Inc.

$

722,007

$

803,150

$

85,226

$

310,814

$

420,055

$

1,032,821

$

1,223,205

$

85,226

December 31, 2018

Puerto Rico

 

Impaired Loans – With an

Impaired Loans

 

 

 

 

 

 

 

Allowance

With No Allowance

Impaired Loans - Total

 

 

 

Unpaid

 

 

 

 

Unpaid

 

 

Unpaid

 

 

 

Recorded

principal

Related

Recorded

principal

Recorded

principal

 

Related

(In thousands)

investment

balance

allowance

investment

balance

investment

balance

 

allowance

Commercial multi-family

$

932

$

932

$

4

$

-

$

-

$

932

$

932

$

4

Commercial real estate non-owner occupied

 

85,583

 

86,282

 

27,494

 

96,005

 

138,378

 

181,588

 

224,660

 

27,494

Commercial real estate owner occupied

 

113,592

 

132,677

 

7,857

 

26,474

 

60,485

 

140,066

 

193,162

 

7,857

Commercial and industrial

 

65,208

 

67,094

 

16,835

 

10,724

 

20,968

 

75,932

 

88,062

 

16,835

Construction

 

1,788

 

1,788

 

56

 

-

 

-

 

1,788

 

1,788

 

56

Mortgage

 

408,767

 

458,010

 

38,760

 

100,701

 

135,084

 

509,468

 

593,094

 

38,760

Leasing

 

1,099

 

1,099

 

320

 

-

 

-

 

1,099

 

1,099

 

320

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

28,829

 

28,829

 

4,571

 

-

 

-

 

28,829

 

28,829

 

4,571

Personal

 

72,989

 

72,989

 

19,098

 

-

 

-

 

72,989

 

72,989

 

19,098

Auto

 

1,161

 

1,161

 

228

 

-

 

-

 

1,161

 

1,161

 

228

Other

 

1,256

 

1,256

 

186

 

-

 

-

 

1,256

 

1,256

 

186

Total Puerto Rico

$

781,204

$

852,117

$

115,409

$

233,904

$

354,915

$

1,015,108

$

1,207,032

$

115,409

December 31, 2018

Popular U.S.

 

Impaired Loans – With an

Impaired Loans

 

 

 

 

 

 

 

Allowance

With No Allowance

Impaired Loans - Total

 

 

 

Unpaid

 

 

 

 

Unpaid

 

 

Unpaid

 

 

 

Recorded

principal

Related

Recorded

principal

Recorded

principal

Related

(In thousands)

investment

balance

allowance

investment

balance

investment

balance

allowance

Construction

$

-

$

-

$

-

$

12,060

$

18,127

$

12,060

$

18,127

$

-

Mortgage

 

7,237

 

8,899

 

2,451

 

2,183

 

3,127

 

9,420

 

12,026

 

2,451

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

HELOCs

 

6,236

 

6,285

 

1,558

 

1,498

 

1,572

 

7,734

 

7,857

 

1,558

Personal

 

631

 

631

 

252

 

142

 

143

 

773

 

774

 

252

Total Popular U.S.

$

14,104

$

15,815

$

4,261

$

15,883

$

22,969

$

29,987

$

38,784

$

4,261

December 31, 2018

Popular, Inc.

 

Impaired Loans – With an

Impaired Loans

 

 

 

 

 

 

 

Allowance

With No Allowance

Impaired Loans - Total

 

 

 

Unpaid

 

 

 

 

Unpaid

 

 

Unpaid

 

 

 

Recorded

principal

Related

Recorded

principal

Recorded

principal

Related

(In thousands)

investment

balance

allowance

investment

balance

investment

balance

allowance

Commercial multi-family

$

932

$

932

$

4

$

-

$

-

$

932

$

932

$

4

Commercial real estate non-owner occupied

 

85,583

 

86,282

 

27,494

 

96,005

 

138,378

 

181,588

 

224,660

 

27,494

Commercial real estate owner occupied

 

113,592

 

132,677

 

7,857

 

26,474

 

60,485

 

140,066

 

193,162

 

7,857

Commercial and industrial

 

65,208

 

67,094

 

16,835

 

10,724

 

20,968

 

75,932

 

88,062

 

16,835

Construction

 

1,788

 

1,788

 

56

 

12,060

 

18,127

 

13,848

 

19,915

 

56

Mortgage

 

416,004

 

466,909

 

41,211

 

102,884

 

138,211

 

518,888

 

605,120

 

41,211

Leasing

 

1,099

 

1,099

 

320

 

-

 

-

 

1,099

 

1,099

 

320

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

28,829

 

28,829

 

4,571

 

-

 

-

 

28,829

 

28,829

 

4,571

HELOCs

 

6,236

 

6,285

 

1,558

 

1,498

 

1,572

 

7,734

 

7,857

 

1,558

Personal

 

73,620

 

73,620

 

19,350

 

142

 

143

 

73,762

 

73,763

 

19,350

Auto

 

1,161

 

1,161

 

228

 

-

 

-

 

1,161

 

1,161

 

228

Other

 

1,256

 

1,256

 

186

 

-

 

-

 

1,256

 

1,256

 

186

Total Popular, Inc.

$

795,308

$

867,932

$

119,670

$

249,787

$

377,884

$

1,045,095

$

1,245,816

$

119,670

The following tables present the average recorded investment and interest income recognized on impaired loans for the years ended December 31, 2019 and 2018.

For the year ended December 31, 2019

 

Puerto Rico

 

Popular U.S.

 

Popular, Inc.

 

Average

 

Interest

 

Average

 

Interest

 

Average

 

Interest

 

recorded

 

income

 

recorded

 

income

 

recorded

 

income

(In thousands)

investment

 

recognized

 

investment

 

recognized

 

investment

 

recognized

Commercial multi-family

$

1,470

 

$

50

 

$

1,343

 

$

-

 

$

2,813

 

$

50

Commercial real estate non-owner occupied

 

183,233

 

 

5,742

 

 

-

 

 

-

 

 

183,233

 

 

5,742

Commercial real estate owner occupied

 

137,710

 

 

6,528

 

 

626

 

 

-

 

 

138,336

 

 

6,528

Commercial and industrial

 

71,828

 

 

4,097

 

 

-

 

 

-

 

 

71,828

 

 

4,097

Construction

 

1,151

 

 

25

 

 

9,248

 

 

-

 

 

10,399

 

 

25

Mortgage

 

518,487

 

 

16,810

 

 

9,416

 

 

153

 

 

527,903

 

 

16,963

Leasing

 

823

 

 

-

 

 

-

 

 

-

 

 

823

 

 

-

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

26,775

 

 

-

 

 

-

 

 

-

 

 

26,775

 

 

-

HELOCs

 

-

 

 

-

 

 

8,988

 

 

-

 

 

8,988

 

 

-

Personal

 

69,664

 

 

282

 

 

380

 

 

-

 

 

70,044

 

 

282

Auto

 

823

 

 

-

 

 

-

 

 

-

 

 

823

 

 

-

Other

 

1,044

 

 

-

 

 

-

 

 

-

 

 

1,044

 

 

-

Total Popular, Inc.

$

1,013,008

 

$

33,534

 

$

30,001

 

$

153

 

$

1,043,009

 

$

33,687

For the year ended December 31, 2018

 

Puerto Rico

 

Popular U.S.

 

Popular, Inc.

 

Average

 

Interest

 

Average

 

Interest

 

Average

 

Interest

 

recorded

 

income

 

recorded

 

income

 

recorded

 

income

(In thousands)

investment

 

recognized

 

investment

 

recognized

 

investment

 

recognized

Commercial multi-family

$

693

 

$

50

 

$

-

 

$

-

 

$

693

 

$

50

Commercial real estate non-owner occupied

 

138,832

 

 

5,742

 

 

-

 

 

-

 

 

138,832

 

 

5,742

Commercial real estate owner occupied

 

148,967

 

 

6,528

 

 

-

 

 

-

 

 

148,967

 

 

6,528

Commercial and industrial

 

69,406

 

 

4,097

 

 

-

 

 

-

 

 

69,406

 

 

4,097

Construction

 

2,094

 

 

25

 

 

9,565

 

 

-

 

 

11,659

 

 

25

Mortgage

 

509,038

 

 

17,663

 

 

9,258

 

 

165

 

 

518,296

 

 

17,828

Leasing

 

1,195

 

 

-

 

 

-

 

 

-

 

 

1,195

 

 

-

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

31,953

 

 

-

 

 

-

 

 

-

 

 

31,953

 

 

-

HELOCs

 

-

 

 

-

 

 

5,904

 

 

-

 

 

5,904

 

 

-

Personal

 

68,237

 

 

415

 

 

770

 

 

-

 

 

69,007

 

 

415

Auto

 

1,413

 

 

-

 

 

-

 

 

-

 

 

1,413

 

 

-

Other

 

1,248

 

 

-

 

 

-

 

 

-

 

 

1,248

 

 

-

Total Popular, Inc.

$

973,076

 

$

34,520

 

$

25,497

 

$

165

 

$

998,573

 

$

34,685

Modifications

A modification of a loan constitutes a troubled debt restructuring when a borrower is experiencing financial difficulty and the modification constitutes a concession. For a summary of the accounting policy related to troubled debt restructurings (“TDRs”), refer to the Summary of Significant Accounting Policies included in Note 2 to these Consolidated Financial Statements.

TDRs amounted to $ 1.6 billion at December 31, 2019 (December 31, 2018 - $ 1.5 billion). The amount of outstanding commitments to lend additional funds to debtors owing receivables whose terms have been modified in TDRs amounted to $ 14 million related to the commercial loan portfolio at December 31, 2019 (December 31, 2018 - $ 16 million).

At December 31, 2019, the mortgage loan TDRs include $ 625 million guaranteed by U.S. sponsored entities at BPPR, compared to $ 543 million at December 31, 2018.

The following table presents the non-covered and covered loans classified as TDRs according to their accruing status and the related allowance at December 31, 2019 and 2018.

 

December 31, 2019

 

 

December 31, 2018

(In thousands)

 

Accruing

 

Non-Accruing

 

Total

 

Related Allowance

 

 

 

Accruing

 

Non-Accruing

 

Total

 

Related Allowance

Loans held-in-portfolio:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial

$

237,861

$

111,587

$

349,448

$

16,443

 

 

$

229,758

$

130,921

$

360,679

$

46,889

Construction

 

-

 

119

 

119

 

6

 

 

 

-

 

1,788

 

1,788

 

56

Mortgage

 

1,013,561

 

126,036

 

1,139,597

 

42,012

 

 

 

906,712

 

135,758

 

1,042,470

 

41,211

Leases

 

264

 

243

 

507

 

61

 

 

 

668

 

440

 

1,108

 

320

Consumer

 

82,205

 

15,808

 

98,013

 

21,404

 

 

 

94,193

 

15,651

 

109,844

 

24,523

Loans held-in-portfolio

$

1,333,891

$

253,793

$

1,587,684

$

79,926

 

 

$

1,231,331

$

284,558

$

1,515,889

$

112,999

The following tables present the loan count by type of modification for those loans modified in a TDR during the years ended December 31, 2019 and 2018. Loans modified as TDRs for the U.S. operations are considered insignificant to the Corporation.

For the year ended December 31, 2019

 

Reduction in interest rate

 

Extension of maturity date

 

Combination of reduction in interest rate and extension of maturity date

 

Other

Commercial multi-family

-

 

3

 

-

 

-

Commercial real estate non-owner occupied

-

 

13

 

-

 

-

Commercial real estate owner occupied

1

 

29

 

-

 

-

Commercial and industrial

2

 

67

 

-

 

-

Mortgage

37

 

130

 

672

 

6

Leasing

-

 

1

 

2

 

-

Consumer:

 

 

 

 

 

 

 

Credit cards

515

 

-

 

2

 

189

HELOCs

-

 

16

 

12

 

-

Personal

668

 

4

 

-

 

3

Auto

-

 

6

 

2

 

-

Other

31

 

-

 

-

 

-

Total

1,254

 

269

 

690

 

198

For the year ended December 31, 2018

 

Reduction in interest rate

 

Extension of maturity date

 

Combination of reduction in interest rate and extension of maturity date

 

Other

Commercial multi-family

-

 

2

 

-

 

-

Commercial real estate non-owner occupied

3

 

17

 

-

 

-

Commercial real estate owner occupied

4

 

64

 

-

 

-

Commercial and industrial

6

 

87

 

-

 

-

Construction

1

 

-

 

-

 

-

Mortgage

85

 

49

 

359

 

57

Leasing

-

 

-

 

4

 

-

Consumer:

 

 

 

 

 

 

 

Credit cards

579

 

-

 

4

 

432

HELOCs

-

 

27

 

11

 

1

Personal

1,356

 

6

 

-

 

2

Auto

-

 

7

 

3

 

-

Other

25

 

-

 

2

 

-

Total

2,059

 

259

 

383

 

492

The following tables present, by class, quantitative information related to loans modified as TDRs during the years ended December 31, 2019 and 2018.

Popular, Inc.

For the year ended December 31, 2019

(Dollars in thousands)

Loan count

Pre-modification outstanding recorded investment

Post-modification outstanding recorded investment

Increase (decrease) in the allowance for loan losses as a result of modification

Commercial multi-family

3

$

346

$

295

$

(40)

Commercial real estate non-owner occupied

13

 

58,142

 

58,116

 

2,811

Commercial real estate owner occupied

30

 

7,533

 

7,249

 

81

Commercial and industrial

69

 

14,991

 

15,435

 

1,368

Mortgage

845

 

83,833

 

77,308

 

2,814

Leasing

3

 

264

 

266

 

7

Consumer:

 

 

 

 

 

 

 

Credit cards

706

 

5,702

 

5,867

 

554

HELOCs

28

 

2,725

 

2,423

 

364

Personal

675

 

10,831

 

10,835

 

3,023

Auto

8

 

121

 

128

 

21

Other

31

 

206

 

206

 

30

Total

2,411

$

184,694

$

178,128

$

11,033

Popular, Inc.

For the year ended December 31, 2018

(Dollars in thousands)

Loan count

Pre-modification outstanding recorded investment

Post-modification outstanding recorded investment

Increase (decrease) in the allowance for loan losses as a result of modification

Commercial multi-family

2

$

1,377

$

1,375

$

106

Commercial real estate non-owner occupied

20

 

109,081

 

79,695

 

6,230

Commercial real estate owner occupied

68

 

31,233

 

29,962

 

1,170

Commercial and industrial

93

 

52,653

 

51,855

 

13,981

Construction

1

 

4,210

 

4,293

 

474

Mortgage

550

 

67,518

 

59,919

 

2,696

Leasing

4

 

98

 

96

 

30

Consumer:

 

 

 

 

 

 

 

Credit cards

1,015

 

10,065

 

10,671

 

1,331

HELOCs

39

 

3,961

 

3,891

 

935

Personal

1,364

 

21,976

 

21,979

 

6,320

Auto

10

 

173

 

152

 

26

Other

27

 

601

 

599

 

99

Total

3,193

$

302,946

$

264,487

$

33,398

During the year ended December 31, 2019, four loans with an aggregate unpaid principal balance of $ 9.1 million were restructured into multiple notes (“Note A / B split”). No charge-offs were recorded as part of those loan restructurings. The following tables present, by class, TDRs that were subject to payment default and that had been modified as a TDR during the twelve months preceding the default date. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date. Loans modified as a TDR that were fully paid down, charged-off or foreclosed upon by period end are not reported.

Defaulted during the year ended December 31, 2019

(Dollars in thousands)

Loan count

Recorded investment as of first default date

Commercial real estate non-owner occupied

1

$

47

Commercial real estate owner occupied

3

 

495

Commercial and industrial

9

 

7,281

Mortgage

63

 

4,424

Leasing

1

 

22

Consumer:

 

 

 

Credit cards

302

 

2,808

HELOCs

1

 

135

Personal

197

 

5,640

Auto

2

 

24

Other

3

 

8

Total

582

$

20,884

Defaulted during the year ended December 31, 2018

(Dollars in thousands)

Loan count

Recorded investment as of first default date

Commercial real estate non-owner occupied

2

$

11,245

Commercial real estate owner occupied

5

 

480

Commercial and industrial

8

 

7,208

Mortgage

161

 

12,362

Consumer:

 

 

 

Credit cards

236

 

2,098

HELOCs

2

 

205

Personal

107

 

2,300

Auto

5

 

115

Other

1

 

7

Total

527

$

36,020

Commercial, consumer and mortgage loans modified in a TDR are closely monitored for delinquency as an early indicator of possible future default. If loans modified in a TDR subsequently default, the Corporation evaluates the loan for possible further impairment. The allowance for loan losses may be increased or partial charge-offs may be taken to further write-down the carrying value of the loan.

Credit Quality

The Corporation has defined a risk rating system to assign a rating to all credit exposures, particularly for the commercial and construction loan portfolios. Risk ratings in the aggregate provide the Corporation’s management the asset quality profile for the loan portfolio. The risk rating system provides for the assignment of ratings at the obligor level based on the financial condition of the borrower. The Corporation’s consumer and mortgage loans are not subject to the risk rating system. Consumer and mortgage loans are classified substandard or loss based on their delinquency status. All other consumer and mortgage loans that are not classified as substandard or loss would be considered “unrated”.

The Corporation’s obligor risk rating scales range from rating 1 (Excellent) to rating 14 (Loss). The obligor risk rating reflects the risk of payment default of a borrower in the ordinary course of business.

Pass Credit Classifications:

Pass (Scales 1 through 8) – Loans classified as pass have a well defined primary source of repayment, with no apparent risk, strong financial position, minimal operating risk, profitability, liquidity and strong capitalization.

Watch (Scale 9) – Loans classified as watch have acceptable business credit, but borrower’s operations, cash flow or financial condition evidence more than average risk, requires above average levels of supervision and attention from Loan Officers.

Special Mention (Scale 10) - Loans classified as special mention have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Corporation’s credit position at some future date.

Adversely Classified Classifications:

Substandard (Scales 11 and 12) - Loans classified as substandard are deemed to be inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans classified as such have well-defined weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.

Doubtful (Scale 13) - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the additional characteristic that the weaknesses make the collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable.

Loss (Scale 14) - Uncollectible and of such little value that continuance as a bankable asset is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this asset even though partial recovery may be effected in the future.

Risk ratings scales 10 through 14 conform to regulatory ratings. The assignment of the obligor risk rating is based on relevant information about the ability of borrowers to service their debts such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors.

The Corporation periodically reviews its loans classification to evaluate if they are properly classified, and to determine impairment, if any. The frequency of these reviews will depend on the amount of the aggregate outstanding debt, and the risk rating classification of the obligor. In addition, during the renewal and annual review process of applicable credit facilities, the Corporation evaluates the corresponding loan grades.

The Corporation has a Commercial Loan Review department within the Corporate Risk Reviews Division that reports directly to the Corporation’s Risk Management Committee and administratively to the Chief Risk Officer, which performs annual comprehensive credit process reviews of all lending groups in BPPR. This group evaluates the credit risk profile of each originating unit along with each unit’s credit administration effectiveness, including the assessment of the risk rating representative of the current credit quality of the loans, and the evaluation of collateral documentation. The monitoring performed by this group contributes to assess

compliance with credit policies and underwriting standards, determine the current level of credit risk, evaluate the effectiveness of the credit management process and identify control deficiencies that may arise in the credit-granting process. Based on its findings, Commercial Loan Review recommends corrective actions, if necessary, that help in maintaining a sound credit process. The Loan Review Group reports the results of the credit process reviews to the Risk Management Committee of the Corporation’s Board of Directors.

The following tables present the outstanding balance, net of unearned income, of non-covered loans held-in-portfolio based on the Corporation’s assignment of obligor risk ratings as defined at December 31, 2019 and 2018.

December 31, 2019

 

 

 

 

Special

 

 

 

 

 

 

 

 

Pass/

 

 

(In thousands)

Watch

Mention

Substandard

Doubtful

Loss

Sub-total

Unrated

Total

Puerto Rico

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial multi-family

$

1,341

$

3,870

$

1,793

$

-

$

-

$

7,004

$

140,845

$

147,849

Commercial real estate non-owner occupied

 

492,357

 

166,810

 

239,448

 

3,290

 

-

 

901,905

 

1,206,313

 

2,108,218

Commercial real estate owner occupied

 

192,895

 

184,678

 

183,377

 

1,629

 

-

 

562,579

 

1,023,750

 

1,586,329

Commercial and industrial

 

592,861

 

170,183

 

130,872

 

148

 

16

 

894,080

 

2,524,654

 

3,418,734

 

Total Commercial

 

1,279,454

 

525,541

 

555,490

 

5,067

 

16

 

2,365,568

 

4,895,562

 

7,261,130

Construction

 

340

 

649

 

20,771

 

-

 

-

 

21,760

 

115,710

 

137,470

Mortgage

 

2,187

 

2,218

 

127,621

 

-

 

-

 

132,026

 

6,034,722

 

6,166,748

Leasing

 

-

 

-

 

3,590

 

-

 

68

 

3,658

 

1,055,849

 

1,059,507

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

-

 

-

 

19,461

 

-

 

-

 

19,461

 

1,104,339

 

1,123,800

 

HELOCs

 

-

 

-

 

-

 

-

 

-

 

-

 

5,038

 

5,038

 

Personal

 

77

 

-

 

19,558

 

-

 

-

 

19,635

 

1,348,515

 

1,368,150

 

Auto

 

-

 

-

 

30,775

 

-

 

372

 

31,147

 

2,886,375

 

2,917,522

 

Other

 

459

 

11

 

15,020

 

-

 

53

 

15,543

 

125,324

 

140,867

 

Total Consumer

 

536

 

11

 

84,814

 

-

 

425

 

85,786

 

5,469,591

 

5,555,377

Total Puerto Rico

$

1,282,517

$

528,419

$

792,286

$

5,067

$

509

$

2,608,798

$

17,571,434

$

20,180,232

Popular U.S.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial multi-family

$

48,359

$

13,827

$

8,433

$

-

$

-

$

70,619

$

1,576,691

$

1,647,310

Commercial real estate non-owner occupied

 

80,608

 

24,383

 

100,658

 

-

 

-

 

205,649

 

1,664,647

 

1,870,296

Commercial real estate owner occupied

 

27,298

 

5,709

 

13,826

 

-

 

-

 

46,833

 

292,302

 

339,135

Commercial and industrial

 

25,679

 

1,460

 

20,386

 

-

 

-

 

47,525

 

1,147,355

 

1,194,880

 

Total Commercial

 

181,944

 

45,379

 

143,303

 

-

 

-

 

370,626

 

4,680,995

 

5,051,621

Construction

 

46,644

 

17,291

 

44,798

 

-

 

-

 

108,733

 

584,889

 

693,622

Mortgage

 

-

 

-

 

11,091

 

-

 

-

 

11,091

 

1,005,693

 

1,016,784

Legacy

 

388

 

202

 

1,528

 

-

 

-

 

2,118

 

19,987

 

22,105

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

-

 

-

 

-

 

-

 

-

 

-

 

36

 

36

 

HELOCs

 

-

 

-

 

2,024

 

-

 

7,930

 

9,954

 

107,389

 

117,343

 

Personal

 

-

 

-

 

1,664

 

-

 

403

 

2,067

 

322,373

 

324,440

 

Other

 

-

 

-

 

-

 

-

 

-

 

-

 

690

 

690

 

Total Consumer

 

-

 

-

 

3,688

 

-

 

8,333

 

12,021

 

430,488

 

442,509

Total Popular U.S.

$

228,976

$

62,872

$

204,408

$

-

$

8,333

$

504,589

$

6,722,052

$

7,226,641

Popular, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial multi-family

$

49,700

$

17,697

$

10,226

$

-

$

-

$

77,623

$

1,717,536

$

1,795,159

Commercial real estate non-owner occupied

 

572,965

 

191,193

 

340,106

 

3,290

 

-

 

1,107,554

 

2,870,960

 

3,978,514

Commercial real estate owner occupied

 

220,193

 

190,387

 

197,203

 

1,629

 

-

 

609,412

 

1,316,052

 

1,925,464

Commercial and industrial

 

618,540

 

171,643

 

151,258

 

148

 

16

 

941,605

 

3,672,009

 

4,613,614

 

Total Commercial

 

1,461,398

 

570,920

 

698,793

 

5,067

 

16

 

2,736,194

 

9,576,557

 

12,312,751

Construction

 

46,984

 

17,940

 

65,569

 

-

 

-

 

130,493

 

700,599

 

831,092

Mortgage

 

2,187

 

2,218

 

138,712

 

-

 

-

 

143,117

 

7,040,415

 

7,183,532

Legacy

 

388

 

202

 

1,528

 

-

 

-

 

2,118

 

19,987

 

22,105

Leasing

 

-

 

-

 

3,590

 

-

 

68

 

3,658

 

1,055,849

 

1,059,507

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

-

 

-

 

19,461

 

-

 

-

 

19,461

 

1,104,375

 

1,123,836

 

HELOCs

 

-

 

-

 

2,024

 

-

 

7,930

 

9,954

 

112,427

 

122,381

 

Personal

 

77

 

-

 

21,222

 

-

 

403

 

21,702

 

1,670,888

 

1,692,590

 

Auto

 

-

 

-

 

30,775

 

-

 

372

 

31,147

 

2,886,375

 

2,917,522

 

Other

 

459

 

11

 

15,020

 

-

 

53

 

15,543

 

126,014

 

141,557

 

Total Consumer

 

536

 

11

 

88,502

 

-

 

8,758

 

97,807

 

5,900,079

 

5,997,886

Total Popular, Inc.

$

1,511,493

$

591,291

$

996,694

$

5,067

$

8,842

$

3,113,387

$

24,293,486

$

27,406,873

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following table presents the weighted average obligor risk rating at December 31, 2019 for those classifications that consider a range of rating scales.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average obligor risk rating

(Scales 11 and 12)

 

 

 

(Scales 1 through 8)

Puerto Rico:

 

 

 

 

Substandard

 

 

 

 

 

 

Pass

 

 

Commercial multi-family

 

 

 

 

 

11.82

 

 

 

 

 

 

 

6.02

 

 

Commercial real estate non-owner occupied

 

 

 

 

 

11.17

 

 

 

 

 

 

 

6.77

 

 

Commercial real estate owner occupied

 

 

 

 

 

11.36

 

 

 

 

 

 

 

7.30

 

 

Commercial and industrial

 

 

 

 

 

11.26

 

 

 

 

 

 

 

7.20

 

 

 

Total Commercial

 

 

 

 

 

11.25

 

 

 

 

 

 

 

7.10

 

 

Construction

 

 

 

 

 

11.01

 

 

 

 

 

 

 

7.85

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Popular U.S. :

 

 

 

 

Substandard

 

 

 

 

 

 

Pass

 

 

Commercial multi-family

 

 

 

 

 

11.25

 

 

 

 

 

 

 

7.37

 

 

Commercial real estate non-owner occupied

 

 

 

 

 

11.00

 

 

 

 

 

 

 

6.94

 

 

Commercial real estate owner occupied

 

 

 

 

 

11.02

 

 

 

 

 

 

 

7.48

 

 

Commercial and industrial

 

 

 

 

 

11.01

 

 

 

 

 

 

 

6.63

 

 

 

Total Commercial

 

 

 

 

 

11.02

 

 

 

 

 

 

 

7.04

 

 

Construction

 

 

 

 

 

11.00

 

 

 

 

 

 

 

7.74

 

 

Legacy

 

 

 

 

 

11.25

 

 

 

 

 

 

 

7.95

 

 

December 31, 2018

 

 

 

 

Special

 

 

 

 

 

 

 

 

Pass/

 

 

(In thousands)

Watch

Mention

Substandard

Doubtful

Loss

Sub-total

Unrated

Total

Puerto Rico

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial multi-family

$

1,634

$

4,548

$

3,590

$

-

$

-

$

9,772

$

135,856

$

145,628

Commercial real estate non-owner occupied

 

470,506

 

233,173

 

342,962

 

-

 

-

 

1,046,641

 

1,275,960

 

2,322,601

Commercial real estate owner occupied

 

262,476

 

174,510

 

291,468

 

2,078

 

-

 

730,532

 

991,721

 

1,722,253

Commercial and industrial

 

655,092

 

130,641

 

156,515

 

177

 

73

 

942,498

 

2,239,663

 

3,182,161

 

Total Commercial

 

1,389,708

 

542,872

 

794,535

 

2,255

 

73

 

2,729,443

 

4,643,200

 

7,372,643

Construction

 

147

 

634

 

1,788

 

-

 

-

 

2,569

 

83,386

 

85,955

Mortgage

 

3,057

 

2,182

 

154,506

 

-

 

-

 

159,745

 

6,273,578

 

6,433,323

Leasing

 

-

 

-

 

3,301

 

-

 

12

 

3,313

 

931,460

 

934,773

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

-

 

-

 

16,035

 

-

 

-

 

16,035

 

1,031,238

 

1,047,273

 

HELOCs

 

-

 

-

 

165

 

-

 

-

 

165

 

5,186

 

5,351

 

Personal

 

849

 

19

 

18,827

 

-

 

-

 

19,695

 

1,230,930

 

1,250,625

 

Auto

 

-

 

-

 

24,093

 

-

 

84

 

24,177

 

2,584,608

 

2,608,785

 

Other

 

-

 

-

 

14,743

 

-

 

215

 

14,958

 

129,786

 

144,744

 

Total Consumer

 

849

 

19

 

73,863

 

-

 

299

 

75,030

 

4,981,748

 

5,056,778

Total Puerto Rico

$

1,393,761

$

545,707

$

1,027,993

$

2,255

$

384

$

2,970,100

$

16,913,372

$

19,883,472

Popular U.S.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial multi-family

$

85,901

$

7,123

$

6,979

$

-

$

-

$

100,003

$

1,301,537

$

1,401,540

Commercial real estate non-owner occupied

 

152,635

 

9,839

 

46,555

 

-

 

-

 

209,029

 

1,672,715

 

1,881,744

Commercial real estate owner occupied

 

49,415

 

23,963

 

2,394

 

-

 

-

 

75,772

 

223,167

 

298,939

Commercial and industrial

 

5,825

 

1,084

 

76,459

 

-

 

-

 

83,368

 

1,004,785

 

1,088,153

 

Total Commercial

 

293,776

 

42,009

 

132,387

 

-

 

-

 

468,172

 

4,202,204

 

4,670,376

Construction

 

35,375

 

37,741

 

58,005

 

-

 

-

 

131,121

 

562,373

 

693,494

Mortgage

 

-

 

-

 

11,032

 

-

 

-

 

11,032

 

790,903

 

801,935

Legacy

 

534

 

224

 

2,409

 

-

 

-

 

3,167

 

22,782

 

25,949

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

-

 

-

 

-

 

-

 

-

 

-

 

38

 

38

 

HELOCs

 

-

 

-

 

2,615

 

-

 

10,964

 

13,579

 

129,473

 

143,052

 

Personal

 

-

 

-

 

1,910

 

-

 

701

 

2,611

 

286,738

 

289,349

 

Other

 

-

 

-

 

4

 

-

 

-

 

4

 

220

 

224

 

Total Consumer

 

-

 

-

 

4,529

 

-

 

11,665

 

16,194

 

416,469

 

432,663

Total Popular U.S.

$

329,685

$

79,974

$

208,362

$

-

$

11,665

$

629,686

$

5,994,731

$

6,624,417

Popular, Inc.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial multi-family

$

87,535

$

11,671

$

10,569

$

-

$

-

$

109,775

$

1,437,393

$

1,547,168

Commercial real estate non-owner occupied

 

623,141

 

243,012

 

389,517

 

-

 

-

 

1,255,670

 

2,948,675

 

4,204,345

Commercial real estate owner occupied

 

311,891

 

198,473

 

293,862

 

2,078

 

-

 

806,304

 

1,214,888

 

2,021,192

Commercial and industrial

 

660,917

 

131,725

 

232,974

 

177

 

73

 

1,025,866

 

3,244,448

 

4,270,314

 

Total Commercial

 

1,683,484

 

584,881

 

926,922

 

2,255

 

73

 

3,197,615

 

8,845,404

 

12,043,019

Construction

 

35,522

 

38,375

 

59,793

 

-

 

-

 

133,690

 

645,759

 

779,449

Mortgage

 

3,057

 

2,182

 

165,538

 

-

 

-

 

170,777

 

7,064,481

 

7,235,258

Legacy

 

534

 

224

 

2,409

 

-

 

-

 

3,167

 

22,782

 

25,949

Leasing

 

-

 

-

 

3,301

 

-

 

12

 

3,313

 

931,460

 

934,773

Consumer:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Credit cards

 

-

 

-

 

16,035

 

-

 

-

 

16,035

 

1,031,276

 

1,047,311

 

HELOCs

 

-

 

-

 

2,780

 

-

 

10,964

 

13,744

 

134,659

 

148,403

 

Personal

 

849

 

19

 

20,737

 

-

 

701

 

22,306

 

1,517,668

 

1,539,974

 

Auto

 

-

 

-

 

24,093

 

-

 

84

 

24,177

 

2,584,608

 

2,608,785

 

Other

 

-

 

-

 

14,747

 

-

 

215

 

14,962

 

130,006

 

144,968

 

Total Consumer

 

849

 

19

 

78,392

 

-

 

11,964

 

91,224

 

5,398,217

 

5,489,441

Total Popular, Inc.

$

1,723,446

$

625,681

$

1,236,355

$

2,255

$

12,049

$

3,599,786

$

22,908,103

$

26,507,889

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The following table presents the weighted average obligor risk rating at December 31, 2018 for those classifications that consider a range of rating scales.

Weighted average obligor risk rating

(Scales 11 and 12)

 

 

 

(Scales 1 through 8)

Puerto Rico:

 

 

 

 

Substandard

 

 

 

 

 

 

Pass

 

 

Commercial multi-family

 

 

 

 

 

11.20

 

 

 

 

 

 

 

6.02

 

 

Commercial real estate non-owner occupied

 

 

 

 

 

11.11

 

 

 

 

 

 

 

6.93

 

 

Commercial real estate owner occupied

 

 

 

 

 

11.29

 

 

 

 

 

 

 

7.25

 

 

Commercial and industrial

 

 

 

 

 

11.33

 

 

 

 

 

 

 

7.15

 

 

 

Total Commercial

 

 

 

 

 

11.22

 

 

 

 

 

 

 

7.09

 

 

Construction

 

 

 

 

 

12.00

 

 

 

 

 

 

 

7.64

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Popular U.S.:

 

 

 

 

Substandard

 

 

 

 

 

 

Pass

 

 

Commercial multi-family

 

 

 

 

 

11.00

 

 

 

 

 

 

 

7.39

 

 

Commercial real estate non-owner occupied

 

 

 

 

 

11.01

 

 

 

 

 

 

 

6.82

 

 

Commercial real estate owner occupied

 

 

 

 

 

11.16

 

 

 

 

 

 

 

7.55

 

 

Commercial and industrial

 

 

 

 

 

11.96

 

 

 

 

 

 

 

7.26

 

 

 

Total Commercial

 

 

 

 

 

11.56

 

 

 

 

 

 

 

7.14

 

 

Construction

 

 

 

 

 

11.21

 

 

 

 

 

 

 

7.85

 

 

Legacy

 

 

 

 

 

11.17

 

 

 

 

 

 

 

7.94