Segment reporting

9 Months Ended

Sep. 30, 2024

Segment reporting disclosure

Segment Reporting

Note 32 – Segment reporting

The Corporation’s corporate structure consists of

two

 reportable segments –

Banco Popular de Puerto Rico and Popular U.S.

Management determined the reportable segments based on the internal reporting used to evaluate performance and to assess

where to allocate resources.

 The segments were determined based on the organizational structure, which focuses primarily on the

markets the segments serve, as well as on the products and services offered by the segments.

Banco Popular de Puerto Rico: 

The Banco Popular de Puerto Rico reportable segment includes commercial, consumer and retail banking operations conducted at

BPPR, including U.S. based activities conducted through its New York Branch. It also includes the lending operations of Popular

Auto and Popular Mortgage. Other financial services within the BPPR segment include the trust service units of BPPR, asset

management services of Popular Asset Management and the brokerage operations of Popular Securities, and the insurance agency

and reinsurance businesses of Popular Insurance, Popular Risk Services, Popular Life Re, and Popular Re.

Popular U.S.: 

Popular U.S. reportable segment consists of the banking operations of Popular Bank (PB), Popular Insurance Agency, U.S.A., and

PEF. PB operates through a retail branch network in the U.S. mainland under the name of Popular, and equipment leasing and

financing services through PEF. Popular Insurance Agency, U.S.A. offers investment and insurance services across the PB branch

network. 

The Corporate group consists primarily of the holding companies Popular, Inc., Popular North America, Popular International Bank

and certain of the Corporation’s investments accounted for under the equity method, including BHD. 

The accounting policies of the individual operating segments are the same as those of the Corporation. Transactions between

reportable segments are primarily conducted at market rates, resulting in profits that are eliminated for reporting consolidated results

of operations.

The tables that follow present the results of operations and total assets by reportable segments:

2024

For the quarter ended September 30, 2024

Intersegment 

(In thousands)

BPPR

Popular U.S.

Eliminations

Net interest income

$

488,008

$

93,128

$

-

Provision for credit losses (benefit)

77,514

(6,066)

-

Non-interest income 

149,050

6,789

-

Amortization of intangibles

394

310

-

Depreciation expense

13,023

2,063

-

Other operating expenses

390,227

62,356

-

Income tax expense

30,064

12,472

-

Net income

$

125,836

$

28,782

$

-

Segment assets

$

56,906,693

$

14,306,045

$

(260,464)

For the quarter ended September 30, 2024

Reportable 

(In thousands)

Segments

Corporate

Eliminations

Total Popular, Inc.

Net interest income (expense)

$

581,136

$

(8,663)

$

-

$

572,473

Provision for credit losses

71,448

-

-

71,448

Non-interest income

155,839

8,876

(633)

164,082

Amortization of intangibles

704

-

-

704

Depreciation expense

15,086

385

-

15,471

Other operating expenses

452,583

(391)

(1,046)

451,146

Income tax expense (benefit)

42,536

(279)

206

42,463

Net income

$

154,618

$

498

$

207

$

155,323

Segment assets

$

70,952,274

$

5,887,340

$

(5,516,540)

$

71,323,074

For the nine months ended September 30, 2024

Intersegment 

(In thousands)

BPPR

Popular U.S.

Eliminations

Net interest income

$

1,449,594

$

263,832

$

-

Provision for credit losses

188,576

1,806

-

Non-interest income 

447,073

19,909

(56)

Amortization of intangibles

1,302

931

-

Depreciation expense

39,349

6,210

-

Other operating expenses

1,170,263

197,307

(56)

Income tax expense

92,810

23,917

-

Net income

$

404,367

$

53,570

$

-

Segment assets

$

56,906,693

$

14,306,045

$

(260,464)

For the nine months ended September 30, 2024

Reportable

Total

(In thousands)

 Segments

Corporate

Eliminations

Popular, Inc.

Net interest income (expense)

$

1,713,426

$

(21,897)

$

-

$

1,691,529

Provision for credit losses

190,382

458

-

190,840

Non-interest income

466,926

31,314

(4,034)

494,206

Amortization of intangibles

2,233

-

-

2,233

Depreciation expense

45,559

1,161

-

46,720

Other operating expenses

1,367,514

7,004

(3,461)

1,371,057

Income tax expense

116,727

21,921

(158)

138,490

Net income (loss)

$

457,937

$

(21,127)

$

(415)

$

436,395

Segment assets

$

70,952,274

$

5,887,340

$

(5,516,540)

$

71,323,074

2023

For the quarter ended September 30, 2023

Intersegment 

(In thousands)

BPPR

 Popular U.S.

Eliminations

Net interest income

$

453,879

$

87,445

$

1

Provision for credit losses (benefit)

51,899

(6,644)

-

Non-interest income 

144,691

5,894

(134)

Amortization of intangibles

484

311

-

Goodwill impairment charge

-

23,000

-

Depreciation expense

12,880

1,962

-

Other operating expenses

369,738

58,341

(134)

Income tax expense

40,861

5,358

-

Net income

$

122,708

$

11,011

$

1

Segment assets

$

57,039,000

$

12,806,630

$

(448,100)

For the quarter ended September 30, 2023

Reportable 

(In thousands)

Segments

Corporate

Eliminations

Total Popular, Inc.

Net interest income (expense)

$

541,325

$

(7,305)

$

-

$

534,020

Provision for credit losses (benefit)

45,255

(138)

-

45,117

Non-interest income

150,451

10,179

(1,081)

159,549

Amortization of intangibles

795

-

-

795

Goodwill impairment charge

23,000

-

-

23,000

Depreciation expense

14,842

381

-

15,223

Other operating expenses

427,945

180

(1,159)

426,966

Income tax expense (benefit)

46,219

(396)

36

45,859

Net income

$

133,720

$

2,847

$

42

$

136,609

Segment assets

$

69,397,530

$

5,554,370

$

(5,214,964)

$

69,736,936

For the nine months ended September 30, 2023

Intersegment

(In thousands)

BPPR

Popular U.S.

 Eliminations

Net interest income

$

1,356,774

$

265,033

$

2

Provision for credit losses

126,952

3,328

-

Non-interest income 

435,966

18,165

(404)

Amortization of intangibles

1,453

932

-

Goodwill impairment charge

-

23,000

-

Depreciation expense

36,424

5,661

-

Other operating expenses

1,119,522

182,809

(404)

Income tax expense

120,996

16,184

-

Net income

$

387,393

$

51,284

$

2

Segment assets

$

57,039,000

$

12,806,630

$

(448,100)

For the nine months ended September 30, 2023

Reportable

Total

(In thousands)

 Segments

Corporate

Eliminations

Popular, Inc.

Net interest income (expense)

$

1,621,809

$

(24,465)

$

-

$

1,597,344

Provision for credit losses (benefit)

130,280

(334)

-

129,946

Non-interest income

453,727

32,905

(4,651)

481,981

Amortization of intangibles

2,385

-

-

2,385

Goodwill impairment charge

23,000

-

-

23,000

Depreciation expense

42,085

1,095

-

43,180

Other operating expenses

1,301,927

(146)

(3,391)

1,298,390

Income tax expense (benefit)

137,180

(1,006)

(498)

135,676

Net income

$

438,679

$

8,831

$

(762)

$

446,748

Segment assets

$

69,397,530

$

5,554,370

$

(5,214,964)

$

69,736,936

Geographic Information

The following information presents selected financial information based on the geographic location where the Corporation conducts

its business. The banking operations of BPPR are primarily based in Puerto Rico, where it has the largest retail banking franchise.

BPPR also conducts banking operations in the U.S. Virgin Islands, the British Virgin Islands and New York. BPPR’s banking

operations in the mainland United States include commercial lending activities. BPPR’s commercial lending activities in the U.S.,

through its New York Branch, include periodic loan participations with PB. During the quarter and nine months ended September 30,

2024, BPPR did

no

t participate in loans originated by PB (2023 – $

10

 million and $

33

 million, respectively). At September 30, 2024,

total assets for the BPPR segment related to its operations in the United States amounted to $

1.6

 billion (December 31, 2023 - $

1.5

billion), including $

105

 million in multifamily loans (December 31, 2023 - $

106

 million), $

521

 million in commercial real estate loans

(December 31, 2023 - $

528

 million), $

747

 million in C&I loans (December 31, 2023 - $

557

 million), and $

140

 million in unsecured

personal loans (December 31, 2023 - $

229

 million). During the nine months ended September 30, 2024, the BPPR segment

generated approximately $

91.2

 million (2023 - $

86.0

 million) in revenues from its operations in the United States, including net

interest income, service charge on deposit accounts and other service fees. In the Virgin Islands, the BPPR segment offers banking

products, including loans and deposits. At September 30, 2024, total assets for the BPPR segment related to its operations in the

U.S. and British Virgin Islands amounted to $

1.0

 billion (December 31, 2023 - $

1.0

 billion). The BPPR segment generated $

32.3

million in revenues during the nine months ended September 30, 2024 (2023 - $

33.6

 million) from its operations in the U.S. and

British Virgin Islands.

Geographic Information

Quarter ended

Nine months ended

(In thousands)

September 30, 2024

September 30, 2023

September 30, 2024

September 30, 2023

Revenues:

[1]

 Puerto Rico 

$

582,953

$

539,985

$

1,735,035

$

1,623,963

 United States

133,067

131,698

386,819

389,463

 Other

20,535

21,886

63,881

65,899

Total consolidated revenues 

$

736,555

$

693,569

$

2,185,735

$

2,079,325

[1]

Total revenues include net interest income, service charges on deposit accounts, other service fees, mortgage banking activities, net (loss) gain,

including impairment, on equity securities, net gain on trading account debt securities, net loss on sale of loans, including valuation adjustments

on loans held-for-sale, adjustments to indemnity reserves on loans sold, and other operating income.

Selected Balance Sheet Information:

(In thousands)

September 30, 2024

December 31, 2023

Puerto Rico

Total assets

$

54,200,914

$

54,181,300

Loans

23,672,112

22,519,961

Deposits

50,759,657

51,282,007

United States

Total assets

$

15,883,947

$

15,343,156

Loans

11,998,043

12,006,012

Deposits

11,203,741

10,643,602

Other

Total assets

$

1,238,213

$

1,233,699

Loans

[1]

530,321

543,299

Deposits

[2]

1,705,103

1,692,634

[1]

Represents loans from BPPR operations located in the U.S. and British Virgin Islands.

[2]

Represents deposits from BPPR operations located in the U.S. and British Virgin Islands.