8-K
OFG BANCORP (OFG)
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
________________
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): January 26, 2023
________________
OFG BANCORP
(Exact name of registrant as specified in its charter)
________________
| Commonwealth of Puerto Rico | 001-12647 | 66-0538893 | |
|---|---|---|---|
| (State or other Jurisdiction of Incorporation) | (Commission File Number) | (IRS Employer Identification No.) | |
| Oriental Center, 15th Floor | |||
| 254 Munoz Rivera Avenue | |||
| San Juan, Puerto Rico | 00918 | ||
| (Address of principal executive offices) | (Zip Code) | ||
| Registrant’s telephone number, including area code: (787) 771-6800 | |||
| Not applicable | |||
| (Former name or former address, if changed since last report) |
________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common shares, par value $1.00 per share | OFG | New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On January 26, 2023, OFG Bancorp (the “Company”) announced the results for the quarter and year ended December 31, 2022. A copy of the Company’s press release is attached as an exhibit to this report.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description of Document |
|---|---|
| 99 | Press release by the Company datedJanuary26, 2023 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
OFG BANCORP
| Date: January 26, 2023 | By: | /s/ Maritza Arizmendi |
|---|---|---|
| Maritza Arizmendi | ||
| Chief Financial Officer |
Document
Exhibit 99
OFG Bancorp Reports 4Q22 & 2022 Results
SAN JUAN, Puerto Rico, January 26, 2023 – OFG Bancorp (NYSE: OFG), the financial holding company for Oriental Bank, reported results for the fourth quarter and year ended December 31, 2022.
Summary
4Q22: EPS diluted of $0.97 compared to $0.87 in 3Q22 and $0.66 in 4Q21. Total core revenues of $168.3 million compared to $156.8 million in 3Q22 and $141.0 million in 4Q21.
Full Year 2022: EPS diluted of $3.44 compared to $2.81 in 2021. Total Core Revenues of $607.8 million compared to $536.6 million.
CEO Comment
José Rafael Fernández, Chief Executive Officer, said: “The fourth quarter reflected total core revenue growth of 7.3% quarter-over-quarter. Key performance metrics improved, with return on average assets of 1.86%, return on average tangible common stockholders’ equity of 20.36%, and an efficiency ratio of 54.45%. Tangible Book Value per share increased to $19.56.”
“Puerto Rico businesses and consumers remain in good financial shape. We look forward to a year of continued progress in 2023, keeping a watchful eye to uncertainties from Federal Reserve Bank rate actions, inflation, and the forecasted mainland recession. We owe a debt of thanks to our team members for their continued dedication, tireless commitment to sales and service, and purposeful drive to bring financial progress to our customers and the communities we serve every day.”
4Q22 Highlights
Net Interest Income of $135.3 million compared to $126.5 million in 3Q22 and $104.2 million in 4Q21. Net interest margin expanded to 5.69% from 5.23% in 3Q22 reflecting FRB rate increases, along with increased investments and loan balances.
Interest Income of $145.7 million compared to $134.7 million in 3Q22 and $112.6 million in 4Q21. Compared to the previous quarter, 4Q22 benefited from higher yields on increased average balances of loans and investment securities.
Total Interest Expense of $10.4 million compared to $8.2 million in 3Q22 and $8.4 million in 4Q21. Compared to 3Q22, 4Q22 interest expense reflected an 11 basis point cost increase, partially offset by a 1.8% balance decline.
Banking & Financial Service Revenues of $33.0 million compared to $30.3 million in 3Q22 and $36.8 million in 4Q21. 4Q22 reflected higher electronic banking activity and higher gain on sale of mortgages compared to 3Q22, which was impacted by business interruptions from Hurricane
Fiona. 4Q22 annual insurance commission recognition of $1.0 million was $1.2 million lower than a year ago due to Fiona related claims.
Pre-Provision Net Revenues of $76.9 million compared to $69.6 million in 3Q22 and $55.8 million in 4Q21.
Provision for Credit Losses of $8.8 million compared to $7.1 million in 3Q22 and $7.2 million in 4Q21. 4Q22 reflected $9.2 million in higher provision due to increased loan volume and a net release of $0.4 million mainly related to reduction in the qualitative adjustment due to the improved macro-economic environment in Puerto Rico as well as stable delinquency trends.
Credit Quality: Net charge offs of $11.2 million compared to $11.3 million in 3Q22 and $32.5 million in 4Q21. 4Q22 reflected $5.4 million for auto loans, $4.0 million for consumer loans, and $3.3 million for a commercial loan previously reserved. 4Q22 early and total delinquency rates and the non-performing loan rate fell from the previous quarter. 4Q21 net charge-offs reflected the decision to sell $65.5 million of past due loans.
Non-Interest Expense of $91.6 million compared to $87.5 million in 3Q22 and $86.5 million in 4Q21. Compared to 3Q22, 4Q22 reflected higher compensation expense due to hourly salary increases implemented in the previous quarter, increases in year-end performance bonuses, and added technology staffing; increased amortization related to new digital projects; and reduced hurricane Fiona related expenses.
Loans Held for Investment (EOP) of $6.84 billion compared to $6.68 billion in 3Q22 and $6.40 billion in 4Q21. Loans increased 2.3% from the previous quarter and 6.8% year-over-year. Compared to 3Q22, 4Q22 loan growth reflected increased balances of commercial, auto, and consumer loans.
New Loan Origination of $616.4 million compared to $511.3 million in 3Q22 and $632.7 million in 4Q21. Compared to 3Q22, 4Q22 originations increased 20.5%, reflecting strong production of commercial loans in Puerto Rico and the mainland, and continued high levels of auto loans at a record $221.4 million.
Total Investments (EOP) of $1.97 billion compared to $2.04 billion in 3Q22 and $895.8 million in 4Q21. Investments declined 3.5% from 3Q22 due to sales of Treasury Bills and paydowns of mortgage backed securities.
Customer Deposits (EOP) of $8.56 billion compared to $8.84 billion in 3Q22 and $8.59 billion in 4Q21. 4Q22 core deposits declined $286.8 million from 3Q22, reflecting lower account balances of approximately $115 million in retail and of $172 million in commercial, including $59 million in public funds.
Total Assets (EOP) of $9.82 billion compared to $10.06 billion in 3Q22 and $9.90 billion in 4Q21.
Capital: CET1 ratio of 13.64% compared to 13.38% in 3Q22 and 13.77% in 4Q21. The change from 3Q22 reflected increased retained earnings and other comprehensive income. Tangible Book Value per share of $19.56 compared to $18.46 in 3Q22 and $19.08 in 4Q21.
Conference Call, Financial Supplement & Presentation
A conference call to discuss 4Q22 results, outlook and related matters will be held today at 10:00 AM ET. Phone (800) 579-2543 or (203) 518-9708. Conference ID: OFGQ422. The call can also be accessed live on www.ofgbancorp.com with webcast replay shortly thereafter.
OFG’s Financial Supplement, with full financial tables for the quarter and year ended December 31, 2022, and the 4Q22 Conference Call Presentation, can be found on the Quarterly Results page on OFG’s Investor Relations website at www.ofgbancorp.com.
Non-GAAP Financial Measures
In addition to our financial information presented in accordance with GAAP, management uses certain “non-GAAP financial measures” within the meaning of SEC Regulation G, to clarify and enhance understanding of past performance and prospects for the future. Please refer to Tables 8-1 and 8-2 in OFG’s above-mentioned Financial Supplement for a reconciliation of GAAP to non-GAAP measures and calculations.
Forward Looking Statements
The information included in this document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements.
Factors that might cause such a difference include but are not limited to (i) general business and economic conditions, including changes in interest rates; (ii) cybersecurity breaches; (iii) hurricanes, earthquakes, and other natural disasters; (iv) competition in the financial services industry; and (v) the severity, magnitude and duration of the COVID-19 pandemic, and its impact on our operations, personnel, and customers.
For a discussion of such factors and certain risks and uncertainties to which OFG is subject, please refer to OFG’s annual report on Form 10-K for the year ended December 31, 2021, as well as its other filings with the U.S. Securities and Exchange Commission. Other than to the extent required by applicable law, including the requirements of applicable securities laws, OFG assumes no obligation to update any forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date of such statements.
About OFG Bancorp
Now in its 59th year in business, OFG Bancorp is a diversified financial holding company that operates under U.S., Puerto Rico and U.S. Virgin Islands banking laws and regulations. Its three principal subsidiaries, Oriental Bank, Oriental Financial Services, and Oriental Insurance, provide a wide range of retail and commercial banking, lending and wealth management products, services, and technology, primarily in Puerto Rico and U.S. Virgin Islands. Visit us at www.ofgbancorp.com.
#
Contacts
Puerto Rico & USVI: Idalis Montalvo (idalis.montalvo@orientalbank.com) at (787) 777-2847
US: Gary Fishman (gfishman@ofgbancorp.com) and Steven Anreder (sanreder@ofgbancorp.com) at (212) 532-3232
OFG Bancorp
Financial Supplement
The information contained in this Financial Supplement is preliminary and based on data available at the time of the earnings presentation, and investors should refer to our December 31, 2022 Annual Report on Form 10-K once it is filed with the Securities and Exchange Commission.
| Table of Contents | ||
|---|---|---|
| Pages | ||
| OFG Bancorp (Consolidated Financial Information) | ||
| Table 1: | Financial and Statistical Summary - Consolidated | 2-3 |
| Table 2: | Consolidated Statements of Operations | 4-5 |
| Table 3: | Consolidated Statements of Financial Condition | 6 |
| Table 4: | Information on Loan Portfolio and Production | 7-8 |
| Table 5: | Average Balances, Net Interest Income and Net Interest Margin | 9-10 |
| Table 6: | Loan Information and Performance Statistics | 11-13 |
| Table 7: | Allowance for Credit Losses | 14 |
| Table 8: | Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital | 15-16 |
| Table 9: | Notes to Financial Summary, Selected Metrics, Loans, and Consolidated Financial Statements (Tables 1-8) | 17 |
OFG Bancorp (NYSE: OFG)
Table 1-1: Financial and Statistical Summary - Consolidated
| 2022 | 2022 | 2022 | 2022 | 2021 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands, except per share data) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | ||||||||||||
| Statement of Operations | |||||||||||||||||
| Net interest income | $ | 135,282 | (a) | $ | 126,510 | $ | 115,094 | $ | 105,194 | $ | 104,199 | ||||||
| Non-interest income, net (core) | (1) | 33,012 | 30,298 | 31,214 | 31,201 | 36,751 | |||||||||||
| Total core revenues | (2) | 168,294 | 156,808 | 146,308 | 136,395 | 140,950 | |||||||||||
| Non-interest expense | 91,641 | 87,492 | 85,258 | 81,155 | 86,490 | ||||||||||||
| Pre-provision net revenues | (21) | 76,895 | 69,638 | 66,046 | 55,645 | 55,809 | |||||||||||
| Total provision for credit losses | 8,757 | 7,120 | 6,691 | 1,551 | 7,199 | ||||||||||||
| Net income before income taxes | 68,138 | 62,518 | 59,355 | 54,094 | 48,610 | ||||||||||||
| Income tax expense | 21,771 | 20,599 | 18,923 | 16,573 | 15,330 | ||||||||||||
| Net income available to common stockholders | 46,367 | 41,919 | 40,432 | 37,521 | 33,280 | ||||||||||||
| Common Share Statistics | |||||||||||||||||
| Earnings per common share - basic | (3) | $ | 0.97 | $ | 0.88 | $ | 0.84 | $ | 0.77 | $ | 0.67 | ||||||
| Earnings per common share - diluted | (4) | $ | 0.97 | $ | 0.87 | $ | 0.84 | $ | 0.76 | $ | 0.66 | ||||||
| Average common shares outstanding | 47,572 | 47,558 | 48,053 | 48,968 | 49,746 | ||||||||||||
| Average common shares outstanding and equivalents | 47,964 | 47,926 | 48,389 | 49,484 | 50,299 | ||||||||||||
| Cash dividends per common share | $ | 0.20 | $ | 0.20 | $ | 0.15 | $ | 0.15 | $ | 0.12 | |||||||
| Book value per common share (period end) | $ | 21.91 | $ | 20.90 | $ | 21.34 | $ | 21.37 | $ | 21.54 | |||||||
| Tangible book value per common share (period end) | (5) | $ | 19.56 | $ | 18.46 | $ | 18.86 | $ | 18.90 | $ | 19.08 | ||||||
| Balance Sheet (Average Balances) | |||||||||||||||||
| Loans | (6) | $ | 6,770,341 | $ | 6,697,900 | $ | 6,640,440 | $ | 6,519,119 | $ | 6,452,128 | ||||||
| Interest-earning assets | 9,425,590 | 9,597,670 | 9,613,327 | 9,540,266 | 9,897,073 | ||||||||||||
| Total assets | 9,989,293 | 10,181,000 | 10,207,579 | 10,113,750 | 10,418,274 | ||||||||||||
| Core deposits | 8,759,080 | 8,924,089 | 8,946,517 | 8,808,547 | 9,084,282 | ||||||||||||
| Total deposits | 8,770,446 | 8,935,455 | 8,957,883 | 8,819,913 | 9,095,648 | ||||||||||||
| Interest-bearing deposits | 6,059,643 | 6,296,142 | 6,266,187 | 6,271,936 | 6,435,246 | ||||||||||||
| Borrowings | 26,820 | 27,275 | 27,726 | 44,262 | 75,970 | ||||||||||||
| Stockholders' equity | 1,025,132 | 1,045,792 | 1,032,270 | 1,066,278 | 1,066,764 | ||||||||||||
| Common stockholders' equity | 1,025,132 | 1,045,792 | 1,032,270 | 1,066,278 | 1,066,764 | ||||||||||||
| Performance Metrics | |||||||||||||||||
| Net interest margin | (7) | 5.69 | % | (a) | 5.23 | % | 4.80 | % | 4.47 | % | 4.18 | % | |||||
| Return on average assets | (8) | 1.86 | % | 1.65 | % | 1.58 | % | 1.48 | % | 1.28 | % | ||||||
| Return on average tangible common stockholders' equity | (9) | 20.36 | % | 18.05 | % | 17.70 | % | 15.88 | % | 14.11 | % | ||||||
| Efficiency ratio | (10) | 54.45 | % | 55.80 | % | 58.27 | % | 59.50 | % | 61.36 | % | ||||||
| Full-time equivalent employees, period end | 2,253 | 2,247 | 2,230 | 2,244 | 2,269 | ||||||||||||
| Credit Quality Metrics | |||||||||||||||||
| Allowance for credit losses | $ | 152,673 | $ | 155,162 | $ | 159,039 | $ | 157,075 | $ | 155,937 | |||||||
| Allowance as a % of loans held for investment | 2.23 | % | 2.32 | % | 2.37 | % | 2.40 | % | 2.44 | % | |||||||
| Net charge-offs | $ | 11,205 | (b) | $ | 11,347 | $ | 4,543 | $ | 577 | $ | 32,482 | ||||||
| Net charge-off rate | (11) | 0.66 | % | (b) | 0.68 | % | 0.27 | % | 0.04 | % | 2.01 | % | |||||
| Early delinquency rate (30 - 89 days past due) | 2.46 | % | 2.75 | % | 2.20 | % | 1.97 | % | 2.34 | % | |||||||
| Total delinquency rate (30 days and over) | 4.04 | % | 4.35 | % | 3.68 | % | 3.17 | % | 3.71 | % | |||||||
| Capital Ratios (period end) (Non-GAAP) | (12)(20) | ||||||||||||||||
| Leverage ratio | 10.36 | % | 9.82 | % | 9.46 | % | 9.54 | % | 9.69 | % | |||||||
| Common equity Tier 1 capital ratio | 13.64 | % | 13.38 | % | 12.80 | % | 13.24 | % | 13.77 | % | |||||||
| Tier 1 risk-based capital ratio | 13.64 | % | 13.38 | % | 12.80 | % | 13.24 | % | 14.27 | % | |||||||
| Total risk-based capital ratio | 14.89 | % | 14.63 | % | 14.05 | % | 14.49 | % | 15.52 | % | |||||||
| Tangible common equity ("TCE") ratio | 9.59 | % | 8.83 | % | 8.85 | % | 9.14 | % | 9.69 | % |
(a)During 4Q 2022, the Federal Reserve System (“FRB”) increased the federal funds rate 125 basis points.
(b)During 4Q 2022, the Company charged-off $3.3 million for a commercial loan previously reserved. At December 31, 2022, this loan was included as held for sale and amounted $6.4 million.
the Company c
OFG Bancorp (NYSE: OFG)
Table 1-2: Financial and Statistical Summary - Consolidated (Continued)
| 2022 | 2021 | |||||||
|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands, except per share data) (unaudited) | YTD | YTD | ||||||
| Statement of Operations | ||||||||
| Net interest income | $ | 482,080 | (a)(b) | $ | 407,349 | |||
| Non-interest income, net (core) | (1) | 125,725 | 129,279 | |||||
| Total core revenues | (2) | 607,805 | (a)(b) | 536,628 | ||||
| Non-interest expense | 345,546 | 325,756 | ||||||
| Pre-provision net revenues | (21) | 268,224 | 214,824 | |||||
| Total provision for (recapture of) credit losses | 24,119 | 221 | ||||||
| Net income before income taxes | 244,105 | 214,603 | ||||||
| Income tax expense | 77,866 | 68,452 | ||||||
| Net income available to common stockholders | 166,239 | 144,896 | ||||||
| Common Share Statistics | ||||||||
| Earnings per common share - basic | (3) | $ | 3.46 | $ | 2.85 | |||
| Earnings per common share - diluted | (4) | $ | 3.44 | $ | 2.81 | |||
| Average common shares outstanding | 48,033 | (c) | 50,956 | |||||
| Average common shares outstanding and equivalents | 48,436 | (c) | 51,370 | |||||
| Cash dividends per common share | $ | 0.70 | (d) | $ | 0.40 | |||
| Book value per common share (period end) | $ | 21.91 | $ | 21.54 | ||||
| Tangible book value per common share (period end) | (5) | $ | 19.56 | $ | 19.08 | |||
| Balance Sheet (Average Balances) | ||||||||
| Loans | (6) | $ | 6,657,760 | $ | 6,537,488 | |||
| Interest-earning assets | 9,544,055 | 9,688,890 | ||||||
| Total assets | 10,119,505 | 10,307,369 | ||||||
| Core deposits | 8,859,600 | 8,923,563 | ||||||
| Total deposits | 8,870,966 | 8,949,227 | ||||||
| Interest-bearing deposits | 6,223,095 | 6,382,303 | ||||||
| Borrowings | 31,461 | (e) | 93,899 | |||||
| Stockholders' equity | 1,042,202 | (c) | 1,079,845 | |||||
| Common stockholders' equity | 1,042,202 | (c) | 1,049,960 | |||||
| Performance Metrics | ||||||||
| Net interest margin | (7) | 5.05 | % | (b) | 4.20 | % | ||
| Return on average assets | (8) | 1.64 | % | 1.42 | % | |||
| Return on average tangible common stockholders' equity | (9) | 17.98 | % | 15.70 | % | |||
| Efficiency ratio | (10) | 56.85 | % | 60.70 | % | |||
| Full-time equivalent employees, period end | 2,253 | 2,269 | ||||||
| Credit Quality Metrics | ||||||||
| Allowance for credit losses | $ | 152,673 | $ | 155,937 | ||||
| Allowance as a % of loans held for investment | 2.23 | % | 2.44 | % | ||||
| Net charge-offs | $ | 27,672 | $ | 49,755 | ||||
| Net charge-off rate | (11) | 0.42 | % | 0.76 | % | |||
| Early delinquency rate (30 - 89 days past due) | 2.46 | % | 2.34 | % | ||||
| Total delinquency rate (30 days and over) | 4.04 | % | 3.71 | % |
(a)During the year ended December 31, 2022, the Company purchased $843 million mortgage backed securities available for sale, $550 million US Treasury Notes available for sale and $200 million US Treasury Notes held to maturity, net of $245 million US Treasury Notes sold.
(b)During the year ended December 31, 2022, the FRB increased the federal funds rate 425 basis points.
(c)During the year ended December 31, 2022, the Company repurchased $64.1 million of shares pursuant to its $100.0 million share buyback program.
(d)During the year ended December 31, 2022, the Company increased its common stock quarterly dividend from $0.12 per share to $0.20 per share.
(e)During the year ended December 31, 2022, the Company redeemed all outstanding $36.1 million subordinated capital notes prior to maturity.
OFG Bancorp (NYSE: OFG)
Table 2-1: Consolidated Statements of Operations
| Quarter Ended | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands, except per share data) (unaudited) | December 31, 2022 | September 30, 2022 | June 30,<br>2022 | March 31,<br>2022 | December 31,<br>2021 | ||||||
| Interest income: | |||||||||||
| Loans | |||||||||||
| Non-PCD loans | $ | 105,238 | $ | 97,677 | $ | 91,788 | $ | 86,631 | $ | 84,914 | |
| PCD loans | 19,762 | 18,563 | 19,569 | 20,934 | 22,660 | ||||||
| Total interest income from loans | 125,000 | 116,240 | 111,357 | 107,565 | 107,574 | ||||||
| Investment securities | 20,727 | 18,435 | 10,865 | 5,384 | 5,036 | ||||||
| Total interest income | 145,727 | (a) | 134,675 | 122,222 | 112,949 | 112,610 | |||||
| Interest expense: | |||||||||||
| Deposits | |||||||||||
| Core deposits | 10,258 | 7,978 | 6,935 | 7,033 | 7,830 | ||||||
| Brokered deposits | 9 | 9 | 9 | 8 | 9 | ||||||
| Total deposits | 10,267 | 7,987 | 6,944 | 7,041 | 7,839 | ||||||
| Borrowings | 178 | 178 | 184 | 714 | 572 | ||||||
| Total interest expense | 10,445 | (a) | 8,165 | 7,128 | 7,755 | 8,411 | |||||
| Net interest income | 135,282 | 126,510 | 115,094 | 105,194 | 104,199 | ||||||
| Provision for (recapture of) credit losses, excluding PCD loans | 11,347 | 9,897 | 12,486 | 8,399 | (461) | ||||||
| (Recapture of) provision for credit losses on PCD loans | (2,590) | (2,777) | (5,795) | (6,848) | 7,660 | ||||||
| Total provision for credit losses | 8,757 | 7,120 | 6,691 | 1,551 | 7,199 | ||||||
| Net interest income after provision for credit losses | 126,525 | 119,390 | 108,403 | 103,643 | 97,000 | ||||||
| Non-interest income: | |||||||||||
| Banking service revenues | 18,224 | 17,234 | 18,141 | 17,562 | 18,770 | ||||||
| Wealth management revenues | 8,335 | (b) | 8,173 | 8,270 | 7,857 | 11,774 | |||||
| Mortgage banking activities | 6,453 | 4,891 | 4,803 | 5,782 | 6,207 | ||||||
| Total banking and financial service revenues | 33,012 | 30,298 | 31,214 | 31,201 | 36,751 | ||||||
| Other income, net | 242 | 322 | 4,996 | 405 | 1,349 | ||||||
| Total non-interest income, net | 33,254 | 30,620 | 36,210 | 31,606 | 38,100 | ||||||
| Non-interest expense: | |||||||||||
| Compensation and employee benefits | 38,100 | (c) | 35,332 | 34,730 | 34,768 | 34,160 | |||||
| Occupancy, equipment and infrastructure costs | 13,893 | (d) | 12,638 | 12,861 | 11,916 | 12,424 | |||||
| General and administrative expenses | 39,261 | (e) | 37,523 | 39,071 | 35,953 | 41,028 | |||||
| Foreclosed real estate and other repossessed assets expenses (income) | 239 | 573 | (1,404) | (1,482) | (1,122) | ||||||
| Climate events expenses | 148 | 1,426 | — | — | — | ||||||
| Total non-interest expense | 91,641 | 87,492 | 85,258 | 81,155 | 86,490 | ||||||
| Income before income taxes | 68,138 | 62,518 | 59,355 | 54,094 | 48,610 | ||||||
| Income tax expense | 21,771 | 20,599 | 18,923 | 16,573 | 15,330 | ||||||
| Net income available to common shareholders | $ | 46,367 | $ | 41,919 | $ | 40,432 | $ | 37,521 | $ | 33,280 |
(a)Refer to “(a)” in Table 1-1.
(b)During 4Q 2022, annual insurance contingent commissions amounted to $1.0 million, $1.2 million lower than a year ago due to Hurricane Fiona’s related claims.
(c)During 4Q 2022, the Company recognized higher compensation expense due to increases in minimum wages for hourly compensated employees and to the accumulation of higher bonuses due to better overall financial performance in 2022.
(d)During 4Q 2022, the Company recognized higher infrastructure costs as a result of $1.4 million amortization of digital projects placed in production.
(e)During 4Q 2022, the Company accrued $750 thousand for the termination of a mortgage servicing contract for loans in portfolio with an unpaid principal balance of $473.7 million.
OFG Bancorp (NYSE: OFG)
Table 2-2: Consolidated Statements of Operations (Continued)
| (Dollars in thousands, except per share data) (unaudited) | Year Ended | ||||||
|---|---|---|---|---|---|---|---|
| December 31, 2022 | December 31, 2021 | ||||||
| Interest income: | |||||||
| Loans | |||||||
| Non-PCD loans | $ | 381,334 | $ | 338,047 | |||
| PCD loans | 78,828 | 95,720 | |||||
| Total interest income from loans | 460,162 | 433,767 | |||||
| Investment securities | 55,411 | 15,411 | |||||
| Total interest income | 515,573 | (a) | 449,178 | ||||
| Interest expense: | |||||||
| Deposits | |||||||
| Core deposits | 32,204 | 38,808 | |||||
| Brokered deposits | 35 | 206 | |||||
| Total deposits | 32,239 | 39,014 | |||||
| Borrowings | 1,254 | 2,815 | |||||
| Total interest expense | 33,493 | 41,829 | |||||
| Net interest income | 482,080 | 407,349 | |||||
| Provision for (recapture of) credit losses, excluding PCD loans | 42,129 | (7,540) | |||||
| (Recapture of) provision for credit losses on PCD loans | (18,010) | 7,761 | |||||
| Total provision for credit losses | 24,119 | (b) | 221 | ||||
| Net interest income after provision for credit losses | 457,961 | 407,128 | |||||
| Non-interest income: | |||||||
| Banking service revenues | 71,161 | 71,718 | |||||
| Wealth management revenues | 32,635 | (c) | 35,044 | ||||
| Mortgage banking activities | 21,929 | 22,517 | |||||
| Total banking and financial service revenues | 125,725 | 129,279 | |||||
| Other income, net | 5,965 | (d) | 3,952 | ||||
| Total non-interest income, net | 131,690 | 133,231 | |||||
| Non-interest expense: | |||||||
| Compensation and employee benefits | 142,930 | (e) | 133,442 | ||||
| Occupancy, equipment and infrastructure costs | 51,308 | 50,158 | |||||
| General and administrative expenses | 151,808 | (f) | 145,163 | ||||
| Foreclosed real estate and other repossessed assets income | (2,074) | (3,007) | |||||
| Climate events expenses | 1,574 | — | |||||
| Total non-interest expense | 345,546 | 325,756 | |||||
| Income before income taxes | 244,105 | 214,603 | |||||
| Income tax expense | 77,866 | 68,452 | |||||
| Net income | 166,239 | 146,151 | |||||
| Less: dividends on preferred stock | — | (1,255) | |||||
| Net income available to common shareholders | $ | 166,239 | $ | 144,896 |
(a)Refer to “(a)” in Table 1-2.
(b)During the year ended December 31, 2022, the Company grew its loan portfolio balances, requiring higher provision for credit losses, among other factors evaluated.
(c)Refer to “(b)” in Table 2-1.
(d)During the year ended December 31, 2022, the Company recognized $4.6 million in other income from the sale of a legacy branch building.
(e)Refer to “(c)” in Table 2-1.
(f)During the year ended December 31, 2022, the Company recognized $2.9 million higher costs in electronic banking and $4.2 million higher compliance-related professional expenses due to greater levels of business activity.
OFG Bancorp (NYSE: OFG)
Table 3: Consolidated Statements of Financial Condition
| (Dollars in thousands) (unaudited) | December 31, 2022 | September 30, 2022 | June 30, 2022 | March 31, 2022 | December 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | $ | 550,464 | $ | 815,433 | $ | 1,307,281 | $ | 1,855,729 | $ | 2,023,650 | ||
| Investments: | ||||||||||||
| Trading securities | 9 | 11 | 13 | 18 | 20 | |||||||
| Investment securities available-for-sale, at fair value, no allowance for credit losses for any period | ||||||||||||
| Mortgage-backed securities | 1,102,501 | 1,075,838 | 1,146,459 | 867,191 | 496,310 | |||||||
| US treasury notes | 309,133 | 401,414 | 10,733 | 10,763 | 10,825 | |||||||
| Other investment securities | 1,142 | 1,157 | 2,378 | 2,384 | 3,578 | |||||||
| Total investment securities available-for-sale | 1,412,776 | 1,478,409 | 1,159,570 | 880,338 | 510,713 | |||||||
| Investment securities held-to-maturity, at amortized cost, no allowance for credit losses for any period | ||||||||||||
| Mortgage-backed securities | 337,435 | 343,549 | 351,016 | 359,806 | 367,507 | |||||||
| US treasury notes | 197,635 | 197,225 | 196,816 | — | — | |||||||
| Total investment securities held-to-maturity | 535,070 | 540,774 | 547,832 | 359,806 | 367,507 | |||||||
| Equity securities | 23,667 | 23,372 | 19,848 | 18,556 | 17,578 | |||||||
| Total investments | 1,971,522 | 2,042,566 | 1,727,263 | 1,258,718 | 895,818 | |||||||
| Loans, net | 6,723,236 | 6,591,028 | 6,585,210 | 6,449,130 | 6,329,311 | |||||||
| Other assets: | ||||||||||||
| Prepaid expenses | 54,641 | 69,535 | 65,327 | 56,513 | 60,856 | |||||||
| Deferred tax asset, net | 55,485 | 66,121 | 76,101 | 87,608 | 99,063 | |||||||
| Foreclosed real estate and repossessed properties | 15,831 | 17,868 | 17,594 | 17,922 | 16,984 | |||||||
| Premises and equipment, net | 106,820 | 106,025 | 101,848 | 97,403 | 92,124 | |||||||
| Goodwill | 84,241 | (a) | 86,069 | 86,069 | 86,069 | 86,069 | ||||||
| Other intangibles | 27,593 | 29,662 | 31,800 | 33,947 | 36,093 | |||||||
| Right of use assets | 25,363 | 26,192 | 27,699 | 28,576 | 28,846 | |||||||
| Servicing asset | 50,921 | 50,061 | 49,280 | 49,446 | 48,973 | |||||||
| Accounts receivable and other assets | 152,663 | 157,619 | 172,302 | 169,059 | 181,933 | |||||||
| Total assets | $ | 9,818,780 | $ | 10,058,179 | $ | 10,247,774 | $ | 10,190,120 | $ | 9,899,720 | ||
| Deposits: | ||||||||||||
| Demand deposits | $ | 5,176,758 | $ | 5,416,309 | $ | 5,459,104 | $ | 5,504,640 | $ | 5,204,340 | ||
| Savings accounts | 2,227,965 | 2,345,673 | 2,433,819 | 2,295,113 | 2,177,780 | |||||||
| Time deposits | 1,152,270 | 1,081,769 | 1,125,276 | 1,167,103 | 1,209,627 | |||||||
| Brokered deposits | 11,371 | 11,366 | 11,371 | 11,366 | 11,371 | |||||||
| Total deposits | 8,568,364 | 8,855,117 | 9,029,570 | 8,978,222 | 8,603,118 | |||||||
| Borrowings: | ||||||||||||
| Advances from FHLB and other borrowings | 27,034 | 27,263 | 27,618 | 28,035 | 28,488 | |||||||
| Subordinated capital notes | — | — | — | — | 36,083 | |||||||
| Total borrowings | 27,034 | 27,263 | 27,618 | 28,035 | 64,571 | |||||||
| Other liabilities: | ||||||||||||
| Acceptances outstanding | 28,607 | 29,245 | 27,150 | 29,858 | 35,329 | |||||||
| Lease liability | 27,370 | 28,114 | 29,538 | 30,287 | 30,498 | |||||||
| GNMA buy-back option program liability | (22) | 32,590 | 29,050 | 33,431 | 9,664 | 14,511 | ||||||
| Accrued expenses and other liabilities | 92,409 | 95,523 | 85,655 | 74,019 | 82,533 | |||||||
| Total liabilities | 8,776,374 | 9,064,312 | 9,232,962 | 9,150,085 | 8,830,560 | |||||||
| Stockholders' equity: | ||||||||||||
| Common stock | 59,885 | 59,885 | 59,885 | 59,885 | 59,885 | |||||||
| Additional paid-in capital | 636,793 | 635,523 | 634,612 | 633,796 | 637,061 | |||||||
| Legal surplus | 133,901 | 129,429 | 125,365 | 121,389 | 117,677 | |||||||
| Retained earnings | 516,371 | 484,057 | 455,590 | 426,320 | 399,949 | |||||||
| Treasury stock, at cost | (211,135) | (211,138) | (211,138) | (180,717) | (150,572) | |||||||
| Accumulated other comprehensive income, net | (93,409) | (103,889) | (49,502) | (20,638) | 5,160 | |||||||
| Total stockholders' equity | 1,042,406 | 993,867 | 1,014,812 | 1,040,035 | 1,069,160 | |||||||
| Total liabilities and stockholders' equity | $ | 9,818,780 | $ | 10,058,179 | $ | 10,247,774 | $ | 10,190,120 | $ | 9,899,720 |
(a)During 4Q 2022, the Company sold its pension plan administration operations for a gain of $179 thousand, reducing its corresponding goodwill by $1.8 million.
OFG Bancorp (NYSE: OFG)
Table 4-1: Information on Loan Portfolio and Production
| (Dollars in thousands) (unaudited) | December 31, 2022 | September 30, 2022 | June 30, 2022 | March 31, 2022 | December 31, 2021 | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Non-PCD: | ||||||||||||
| Mortgage | $ | 643,203 | $ | 650,781 | $ | 675,324 | $ | 694,613 | $ | 704,337 | ||
| Mortgage GNMA buy-back option program | (22) | 32,590 | 29,050 | 33,431 | 9,664 | 14,511 | ||||||
| Commercial | 2,464,075 | 2,363,299 | 2,388,281 | 2,256,011 | 2,088,106 | |||||||
| Commercial Paycheck Protection Program (PPP Loans) | (23) | 6,702 | 14,082 | 33,304 | 53,277 | 86,889 | ||||||
| Consumer | 536,619 | 520,183 | 498,404 | 454,959 | 408,759 | |||||||
| Auto | 1,958,257 | 1,877,945 | 1,791,052 | 1,732,859 | 1,693,029 | |||||||
| 5,641,446 | 5,455,340 | 5,419,796 | 5,201,383 | 4,995,631 | ||||||||
| Less: Allowance for credit losses | (141,841) | (142,417) | (143,896) | (137,344) | (132,065) | |||||||
| Total non- PCD loans held for investment, net | 5,499,605 | 5,312,923 | 5,275,900 | 5,064,039 | 4,863,566 | |||||||
| PCD: | ||||||||||||
| Mortgage | 1,028,428 | 1,059,448 | 1,099,097 | 1,144,364 | 1,188,423 | |||||||
| Commercial | 159,152 | 162,287 | 174,282 | 190,626 | 204,335 | |||||||
| Consumer | 638 | 738 | 698 | 833 | 916 | |||||||
| Auto | 5,658 | 7,152 | 8,788 | 10,765 | 13,281 | |||||||
| 1,193,876 | 1,229,625 | 1,282,865 | 1,346,588 | 1,406,955 | ||||||||
| Less: Allowance for credit losses | (10,832) | (12,745) | (15,143) | (19,731) | (23,872) | |||||||
| Total PCD loans held for investment, net | 1,183,044 | 1,216,880 | 1,267,722 | 1,326,857 | 1,383,083 | |||||||
| Total loans held for investment | 6,682,649 | 6,529,803 | 6,543,622 | 6,390,896 | 6,246,649 | |||||||
| Mortgage loans held for sale | 19,499 | 43,262 | 26,947 | 26,761 | 51,096 | |||||||
| Other loans held for sale | 21,088 | (a) | 17,963 | 14,641 | 31,473 | 31,566 | ||||||
| Total loans, net | $ | 6,723,236 | $ | 6,591,028 | $ | 6,585,210 | $ | 6,449,130 | $ | 6,329,311 | ||
| Loan Portfolio Summary: | ||||||||||||
| Loans held for investment: | ||||||||||||
| Mortgage | $ | 1,671,631 | $ | 1,710,229 | $ | 1,774,421 | $ | 1,838,977 | $ | 1,892,760 | ||
| Mortgage GNMA buy-back option program | (22) | 32,590 | 29,050 | 33,431 | 9,664 | 14,511 | ||||||
| Commercial | 2,623,227 | 2,525,586 | 2,562,563 | 2,446,637 | 2,292,441 | |||||||
| Commercial Paycheck Protection Program (PPP Loans) | (23) | 6,702 | 14,082 | 33,304 | 53,277 | 86,889 | ||||||
| Consumer | 537,257 | 520,921 | 499,102 | 455,792 | 409,675 | |||||||
| Auto | 1,963,915 | 1,885,097 | 1,799,840 | 1,743,624 | 1,706,310 | |||||||
| 6,835,322 | 6,684,965 | 6,702,661 | 6,547,971 | 6,402,586 | ||||||||
| Less: Allowance for credit losses | (152,673) | (155,162) | (159,039) | (157,075) | (155,937) | |||||||
| Total loans held for investment, net | 6,682,649 | 6,529,803 | 6,543,622 | 6,390,896 | 6,246,649 | |||||||
| Mortgage loans held for sale | 19,499 | 43,262 | 26,947 | 26,761 | 51,096 | |||||||
| Other loans held for sale | 21,088 | (a) | 17,963 | 14,641 | 31,473 | 31,566 | ||||||
| Total loans, net | $ | 6,723,236 | $ | 6,591,028 | $ | 6,585,210 | $ | 6,449,130 | $ | 6,329,311 |
(a)Refer to “(b)” in Table 1-1.
OFG Bancorp (NYSE: OFG)
Table 4-2: Information on Loan Portfolio and Production
| Quarter Ended | Year Ended | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | December 31, 2022 | September 30, 2022 | June 30, 2022 | March 31, 2022 | December 31, 2021 | December 31, 2022 | December 31, 2021 | ||||||||
| Loan production | (13) | ||||||||||||||
| Mortgage | $ | 35,242 | $ | 38,945 | $ | 62,835 | $ | 63,883 | $ | 78,991 | $ | 200,905 | $ | 364,214 | |
| Commercial | 209,078 | 123,429 | 143,796 | 175,531 | 238,356 | 651,834 | 694,747 | ||||||||
| Commercial PPP Loans | — | — | — | — | — | — | 158,994 | ||||||||
| Commercial US Loans | 83,162 | 55,984 | 90,952 | 108,390 | 79,264 | 338,488 | 333,693 | ||||||||
| Consumer | 67,515 | 73,045 | 96,571 | 97,108 | 80,688 | 334,239 | 196,848 | ||||||||
| Auto | 221,369 | 219,910 | 193,031 | 178,288 | 155,390 | 812,598 | 641,705 | ||||||||
| Total | $ | 616,366 | $ | 511,313 | $ | 587,185 | $ | 623,200 | $ | 632,689 | $ | 2,338,064 | $ | 2,390,201 |
OFG Bancorp (NYSE: OFG)
Table 5-1: Average Balances, Net Interest Income and Net Interest Margin
| 2022 Q4 | 2022 Q3 | 2022 Q2 | 2022 Q1 | 2021 Q4 | ||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | |||||||||||||||
| Interest earning assets: | ||||||||||||||||||||||||||||||
| Cash equivalents | $ | 551,555 | $ | 5,115 | 3.68 | % | $ | 1,016,561 | $ | 5,661 | 2.21 | % | $ | 1,546,036 | $ | 2,984 | 0.77 | % | $ | 2,072,112 | $ | 929 | 0.18 | % | $ | 2,553,118 | $ | 944 | 0.15 | % |
| Investment securities | 2,103,694 | 15,612 | 2.97 | % | 1,883,209 | 12,774 | 2.71 | % | 1,426,851 | 7,881 | 2.21 | % | 949,035 | 4,455 | 1.88 | % | 891,827 | 4,092 | 1.84 | % | ||||||||||
| Loans held for investment | ||||||||||||||||||||||||||||||
| Non-PCD loans | 5,542,986 | 105,238 | 7.53 | % | 5,428,852 | 97,677 | 7.14 | % | 5,315,401 | 91,788 | 6.93 | % | 5,113,715 | 86,631 | 6.87 | % | 4,953,279 | 84,914 | 6.80 | % | ||||||||||
| PCD loans | 1,227,355 | 19,762 | 6.44 | % | 1,269,048 | 18,563 | 5.85 | % | 1,325,039 | 19,569 | 5.91 | % | 1,405,404 | 20,934 | 5.96 | % | 1,498,849 | 22,660 | 6.05 | % | ||||||||||
| Total loans | 6,770,341 | 125,000 | 7.32 | % | 6,697,900 | 116,240 | 6.89 | % | 6,640,440 | 111,357 | 6.73 | % | 6,519,119 | 107,565 | 6.69 | % | 6,452,128 | 107,574 | 6.62 | % | ||||||||||
| Total interest-earning assets | $ | 9,425,590 | $ | 145,727 | 6.13 | % | $ | 9,597,670 | $ | 134,675 | 5.57 | % | $ | 9,613,327 | $ | 122,222 | 5.10 | % | $ | 9,540,266 | $ | 112,949 | 4.80 | % | $ | 9,897,073 | $ | 112,610 | 4.51 | % |
| Interest bearing liabilities: | ||||||||||||||||||||||||||||||
| Deposits | ||||||||||||||||||||||||||||||
| NOW accounts | $ | 2,624,602 | $ | 4,050 | 0.61 | % | $ | 2,799,234 | $ | 2,927 | 0.41 | % | $ | 2,811,396 | $ | 2,174 | 0.31 | % | $ | 2,813,037 | $ | 2,140 | 0.31 | % | $ | 2,792,966 | $ | 2,239 | 0.32 | % |
| Savings accounts | 2,291,884 | 2,250 | 0.39 | % | 2,388,072 | 1,733 | 0.29 | % | 2,296,903 | 1,289 | 0.23 | % | 2,248,193 | 1,198 | 0.22 | % | 2,359,959 | 1,289 | 0.22 | % | ||||||||||
| Time deposits | 1,131,791 | 2,373 | 0.83 | % | 1,097,470 | 1,679 | 0.61 | % | 1,146,522 | 1,834 | 0.64 | % | 1,199,340 | 2,057 | 0.70 | % | 1,270,955 | 2,464 | 0.77 | % | ||||||||||
| Brokered deposits | 11,366 | 9 | 0.30 | % | 11,366 | 9 | 0.30 | % | 11,366 | 9 | 0.30 | % | 11,366 | 8 | 0.30 | % | 11,366 | 9 | 0.30 | % | ||||||||||
| 6,059,643 | 8,682 | 0.57 | % | 6,296,142 | 6,348 | 0.40 | % | 6,266,187 | 5,306 | 0.34 | % | 6,271,936 | 5,403 | 0.35 | % | 6,435,246 | 6,001 | 0.37 | % | |||||||||||
| Non-interest bearing deposit accounts | 2,710,803 | — | — | 2,639,313 | — | — | 2,691,696 | — | — | 2,547,977 | — | — | 2,660,402 | — | — | |||||||||||||||
| Fair value premium and core deposit intangible amortization | — | 1,585 | — | — | 1,639 | — | — | 1,638 | — | — | 1,638 | — | — | 1,838 | — | |||||||||||||||
| Total deposits | 8,770,446 | 10,267 | 0.46 | % | 8,935,455 | 7,987 | 0.35 | % | 8,957,883 | 6,944 | 0.31 | % | 8,819,913 | 7,041 | 0.32 | % | 9,095,648 | 7,839 | 0.34 | % | ||||||||||
| Borrowings | ||||||||||||||||||||||||||||||
| Advances from FHLB and other borrowings | 26,820 | 178 | 2.64 | % | 27,275 | 178 | 2.59 | % | 27,726 | 184 | 2.66 | % | 28,184 | 193 | 2.77 | % | 39,887 | 279 | 2.78 | % | ||||||||||
| Subordinated capital notes | — | — | — | % | — | — | — | % | — | — | — | % | 16,078 | 521 | 13.15 | % | 36,083 | 293 | 3.23 | % | ||||||||||
| Total borrowings | 26,820 | 178 | 2.64 | % | 27,275 | 178 | 2.59 | % | 27,726 | 184 | 2.66 | % | 44,262 | 714 | 6.54 | % | 75,970 | 572 | 2.99 | % | ||||||||||
| Total interest-bearing liabilities | $ | 8,797,266 | $ | 10,445 | 0.47 | % | $ | 8,962,730 | $ | 8,165 | 0.36 | % | $ | 8,985,609 | $ | 7,128 | 0.32 | % | $ | 8,864,175 | $ | 7,755 | 0.35 | % | $ | 9,171,618 | $ | 8,411 | 0.36 | % |
| Interest rate spread | $ | 135,282 | 5.66 | % | $ | 126,510 | 5.21 | % | $ | 115,094 | 4.78 | % | $ | 105,194 | 4.45 | % | $ | 104,199 | 4.15 | % | ||||||||||
| Net interest margin | 5.69 | % | 5.23 | % | 4.80 | % | 4.47 | % | 4.18 | % | ||||||||||||||||||||
| Core deposits: (Non-GAAP) | ||||||||||||||||||||||||||||||
| Deposits | ||||||||||||||||||||||||||||||
| NOW accounts | $ | 2,624,602 | $ | 4,050 | 0.61 | % | $ | 2,799,234 | $ | 2,927 | 0.41 | % | $ | 2,811,396 | $ | 2,174 | 0.31 | % | $ | 2,813,037 | $ | 2,140 | 0.31 | % | $ | 2,792,966 | $ | 2,239 | 0.32 | % |
| Savings accounts | 2,291,884 | 2,250 | 0.39 | % | 2,388,072 | 1,733 | 0.29 | % | 2,296,903 | 1,289 | 0.23 | % | 2,248,193 | 1,198 | 0.22 | % | 2,359,959 | 1,289 | 0.22 | % | ||||||||||
| Time deposits | 1,131,791 | 2,373 | 0.83 | % | 1,097,470 | 1,679 | 0.61 | % | 1,146,522 | 1,834 | 0.64 | % | 1,199,340 | 2,057 | 0.70 | % | 1,270,955 | 2,464 | 0.77 | % | ||||||||||
| 6,048,277 | 8,673 | 0.57 | % | 6,284,776 | 6,339 | 0.40 | % | 6,254,821 | 5,297 | 0.34 | % | 6,260,570 | 5,395 | 0.35 | % | 6,423,880 | 5,992 | 0.37 | % | |||||||||||
| Non-interest bearing deposit accounts | 2,710,803 | — | — | 2,639,313 | — | — | 2,691,696 | — | — | 2,547,977 | — | — | 2,660,402 | — | — | |||||||||||||||
| Total core deposits | $ | 8,759,080 | $ | 8,673 | 0.39 | % | $ | 8,924,089 | $ | 6,339 | 0.28 | % | $ | 8,946,517 | $ | 5,297 | 0.24 | % | $ | 8,808,547 | $ | 5,395 | 0.25 | % | $ | 9,084,282 | $ | 5,992 | 0.26 | % |
OFG Bancorp (NYSE: OFG)
Table 5-2: Average Balances, Net Interest Income and Net Interest Margin (Continued)
| 2022 YTD | 2021 YTD | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | Average<br>Balance | Interest<br>Income/<br>Expense | Yield/<br>Rate | ||||||
| Interest earning assets: | ||||||||||||
| Cash equivalents | $ | 1,291,633 | $ | 14,689 | 1.14 | % | $ | 2,466,926 | $ | 3,231 | 0.13 | % |
| Investment securities | 1,594,662 | 40,722 | 2.55 | % | 684,476 | 12,180 | 1.78 | % | ||||
| Loans held for investment | ||||||||||||
| Non-PCD loans | 5,351,639 | 381,334 | 7.13 | % | 4,921,186 | 338,047 | 6.87 | % | ||||
| PCD loans | 1,306,121 | 78,828 | 6.04 | % | 1,616,302 | 95,720 | 5.92 | % | ||||
| Total loans | 6,657,760 | 460,162 | 6.91 | % | 6,537,488 | 433,767 | 6.64 | % | ||||
| Total interest-earning assets | $ | 9,544,055 | $ | 515,573 | 5.40 | % | $ | 9,688,890 | $ | 449,178 | 4.64 | % |
| Interest bearing liabilities: | ||||||||||||
| Deposits | ||||||||||||
| NOW accounts | $ | 2,761,653 | $ | 11,291 | 0.41 | % | $ | 2,623,358 | $ | 9,179 | 0.35 | % |
| Savings accounts | 2,306,607 | 6,470 | 0.28 | % | 2,233,824 | 7,149 | 0.32 | % | ||||
| Time deposits | 1,143,469 | 7,943 | 0.69 | % | 1,499,457 | 15,130 | 1.01 | % | ||||
| Brokered deposits | 11,366 | 35 | 0.30 | % | 25,664 | 206 | 0.80 | % | ||||
| 6,223,095 | 25,739 | 0.41 | % | 6,382,303 | 31,664 | 0.50 | % | |||||
| Non-interest bearing deposit accounts | 2,647,871 | — | — | 2,566,924 | — | — | % | |||||
| Fair value premium and core deposit intangible amortization | — | 6,500 | — | — | 7,350 | — | ||||||
| Total deposits | 8,870,966 | 32,239 | 0.36 | % | 8,949,227 | 39,014 | 0.44 | % | ||||
| Borrowings | ||||||||||||
| Advances from FHLB and other borrowings | 27,497 | 733 | 2.67 | % | 57,816 | 1,641 | 2.84 | % | ||||
| Subordinated capital notes | 3,964 | 521 | 13.15 | % | 36,083 | 1,174 | 3.25 | % | ||||
| Total borrowings | 31,461 | 1,254 | 3.99 | % | 93,899 | 2,815 | 3.00 | % | ||||
| Total interest-bearing liabilities | $ | 8,902,427 | $ | 33,493 | 0.38 | % | $ | 9,043,126 | $ | 41,829 | 0.46 | % |
| Interest rate spread | $ | 482,080 | 5.02 | % | $ | 407,349 | 4.18 | % | ||||
| Net interest margin | 5.05 | % | 4.20 | % | ||||||||
| Core deposits: (Non-GAAP) | ||||||||||||
| Deposits | ||||||||||||
| NOW accounts | $ | 2,761,653 | $ | 11,291 | 0.41 | % | $ | 2,623,358 | $ | 9,179 | 0.35 | % |
| Savings accounts | 2,306,607 | 6,470 | 0.28 | % | 2,233,824 | 7,149 | 0.32 | % | ||||
| Time deposits | 1,143,469 | 7,943 | 0.69 | % | 1,499,457 | 15,130 | 1.01 | % | ||||
| 6,211,729 | 25,704 | 0.41 | % | 6,356,639 | 31,458 | 0.49 | % | |||||
| Non-interest bearing deposit accounts | 2,647,871 | — | — | % | 2,566,924 | — | — | % | ||||
| Total core deposits | $ | 8,859,600 | $ | 25,704 | 0.29 | % | $ | 8,923,563 | $ | 31,458 | 0.35 | % |
OFG Bancorp (NYSE: OFG)
Table 6-1: Loan Information and Performance Statistics
| 2022 | 2022 | 2022 | 2022 | 2021 | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | |||||||||||
| Net Charge-offs | ||||||||||||||||
| Non-PCD | ||||||||||||||||
| Mortgage: | ||||||||||||||||
| Charge-offs | $ | 8 | $ | 14 | $ | 259 | $ | 3 | $ | 4,573 | ||||||
| Recoveries | (625) | (280) | (335) | (2,074) | (416) | |||||||||||
| Total mortgage | (617) | (266) | (76) | (2,071) | 4,157 | |||||||||||
| Commercial: | ||||||||||||||||
| Charge-offs | 3,444 | (b) | 6,485 | 2,907 | 544 | 550 | ||||||||||
| Recoveries | (338) | (214) | (456) | (192) | (418) | |||||||||||
| Total commercial | 3,106 | 6,271 | 2,451 | 352 | 132 | |||||||||||
| Consumer: | ||||||||||||||||
| Charge-offs | 5,069 | 4,163 | 3,307 | 2,659 | 2,144 | |||||||||||
| Recoveries | (1,055) | (732) | (795) | (655) | (743) | |||||||||||
| Total consumer | 4,014 | 3,431 | 2,512 | 2,004 | 1,401 | |||||||||||
| Auto: | ||||||||||||||||
| Charge-offs | 10,380 | 7,964 | 6,428 | 7,890 | 7,288 | |||||||||||
| Recoveries | (5,001) | (5,674) | (5,565) | (4,891) | (6,282) | |||||||||||
| Total auto | 5,379 | 2,290 | 863 | 2,999 | 1,006 | |||||||||||
| Total | $ | 11,882 | $ | 11,726 | $ | 5,750 | $ | 3,284 | $ | 6,696 | ||||||
| PCD | ||||||||||||||||
| Mortgage: | ||||||||||||||||
| Charge-offs | $ | 108 | $ | 270 | $ | 183 | $ | 1,134 | $ | 15,010 | ||||||
| Recoveries | (603) | (191) | (1,026) | (845) | (452) | |||||||||||
| Total mortgage | (495) | 79 | (843) | 289 | 14,558 | |||||||||||
| Commercial: | ||||||||||||||||
| Charge-offs | 12 | 23 | — | 34 | 12,123 | |||||||||||
| Recoveries | (264) | (268) | (249) | (3,023) | (746) | |||||||||||
| Total commercial | (252) | (245) | (249) | (2,989) | 11,377 | |||||||||||
| Consumer: | ||||||||||||||||
| Charge-offs | 120 | 9 | 8 | 39 | — | |||||||||||
| Recoveries | (11) | (47) | (13) | (23) | (42) | |||||||||||
| Total consumer | 109 | (38) | (5) | 16 | (42) | |||||||||||
| Auto: | ||||||||||||||||
| Charge-offs | 65 | 56 | 75 | 114 | 140 | |||||||||||
| Recoveries | (104) | (231) | (185) | (137) | (247) | |||||||||||
| Total auto | (39) | (175) | (110) | (23) | (107) | |||||||||||
| Total | $ | (677) | $ | (379) | $ | (1,207) | $ | (2,707) | $ | 25,786 | ||||||
| Total Net Charge-offs | $ | 11,205 | $ | 11,347 | $ | 4,543 | $ | 577 | $ | 32,482 | ||||||
| Net Charge-off Rates | ||||||||||||||||
| Mortgage | -0.26 | % | -0.04 | % | -0.20 | % | -0.38 | % | 3.79 | % | ||||||
| Commercial | 0.44 | % | 0.94 | % | 0.34 | % | -0.43 | % | 1.95 | % | ||||||
| Consumer | 2.95 | % | 2.52 | % | 1.98 | % | 1.75 | % | 1.29 | % | ||||||
| Auto | 1.11 | % | 0.46 | % | 0.17 | % | 0.69 | % | 0.21 | % | ||||||
| Total | 0.66 | % | 0.68 | % | 0.27 | % | 0.04 | % | 2.01 | % | ||||||
| Average Loans Held For Investment | ||||||||||||||||
| Mortgage | $ | 1,699,923 | $ | 1,757,897 | $ | 1,809,228 | $ | 1,885,159 | $ | 1,972,889 | ||||||
| Commercial | 2,586,536 | 2,560,849 | 2,555,575 | 2,450,177 | 2,362,120 | |||||||||||
| Consumer | 558,809 | 538,898 | 506,588 | 461,890 | 421,824 | |||||||||||
| Auto | 1,925,073 | 1,840,256 | 1,769,049 | 1,721,893 | 1,695,295 | |||||||||||
| Total | $ | 6,770,341 | $ | 6,697,900 | $ | 6,640,440 | $ | 6,519,119 | $ | 6,452,128 |
(a)Refer to “(b)” in Table 1-1.
OFG Bancorp (NYSE: OFG)
Table 6-2: Loan Information and Performance Statistics (Excludes PCD Loans)
| 2022 | 2022 | 2022 | 2022 | 2021 | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | |||||||||||
| Early Delinquency (30 - 89 days past due) | ||||||||||||||||
| Mortgage | $ | 15,115 | $ | 15,769 | $ | 13,941 | $ | 13,788 | $ | 16,565 | ||||||
| Commercial | 2,750 | 13,223 | 6,001 | 2,600 | 4,736 | |||||||||||
| Consumer | 8,895 | 9,280 | 7,766 | 6,485 | 5,273 | |||||||||||
| Auto | 112,191 | 111,637 | 91,407 | 79,491 | 90,272 | |||||||||||
| Total | $ | 138,951 | $ | 149,909 | $ | 119,115 | $ | 102,364 | $ | 116,846 | ||||||
| Early Delinquency Rates (30 - 89 days past due) | ||||||||||||||||
| Mortgage | 2.24 | % | 2.32 | % | 1.97 | % | 1.96 | % | 2.30 | % | ||||||
| Commercial | 0.11 | % | 0.56 | % | 0.25 | % | 0.12 | % | 0.23 | % | ||||||
| Consumer | 1.66 | % | 1.78 | % | 1.56 | % | 1.43 | % | 1.29 | % | ||||||
| Auto | 5.73 | % | 5.94 | % | 5.10 | % | 4.59 | % | 5.33 | % | ||||||
| Total | 2.46 | % | 2.75 | % | 2.20 | % | 1.97 | % | 2.34 | % | ||||||
| Total Delinquency (30 days and over past due) | ||||||||||||||||
| Mortgage: | ||||||||||||||||
| Traditional, Non traditional, and Loans under Loss Mitigation | $ | 39,237 | $ | 39,577 | $ | 36,178 | $ | 39,004 | $ | 45,521 | ||||||
| GNMA's buy-back option program | (22) | 32,590 | 29,050 | 33,431 | 9,664 | 14,511 | ||||||||||
| Total mortgage | 71,827 | 68,627 | 69,609 | 48,668 | 60,032 | |||||||||||
| Commercial | 12,121 | 24,343 | 13,243 | 16,061 | 14,129 | |||||||||||
| Consumer | 12,009 | 11,956 | 9,744 | 8,446 | 7,246 | |||||||||||
| Auto | 131,804 | 132,507 | 106,637 | 91,855 | 103,733 | |||||||||||
| Total | $ | 227,761 | $ | 237,433 | $ | 199,233 | $ | 165,030 | $ | 185,140 | ||||||
| Total Delinquency Rates (30 days and over past due) | ||||||||||||||||
| Mortgage: | ||||||||||||||||
| Traditional, Non traditional, and Loans under Loss Mitigation | 5.81 | % | 5.82 | % | 5.10 | % | 5.54 | % | 6.33 | % | ||||||
| GNMA's buy-back option program | (22) | 4.82 | % | 4.27 | % | 4.72 | % | 1.37 | % | 2.02 | % | |||||
| Total mortgage | 10.63 | % | 10.09 | % | 9.82 | % | 6.91 | % | 8.35 | % | ||||||
| Commercial | 0.49 | % | 1.03 | % | 0.55 | % | 0.71 | % | 0.68 | % | ||||||
| Consumer | 2.24 | % | 2.30 | % | 1.96 | % | 1.86 | % | 1.77 | % | ||||||
| Auto | 6.73 | % | 7.06 | % | 5.95 | % | 5.30 | % | 6.13 | % | ||||||
| Total | 4.04 | % | 4.35 | % | 3.68 | % | 3.17 | % | 3.71 | % | ||||||
| Nonperforming Assets | (14) | |||||||||||||||
| Mortgage | $ | 33,512 | $ | 33,225 | $ | 33,344 | $ | 36,775 | $ | 39,394 | ||||||
| Commercial | 34,432 | 36,612 | 47,206 | 34,892 | 37,603 | |||||||||||
| Consumer | 3,128 | 2,725 | 1,987 | 2,030 | 2,303 | |||||||||||
| Auto | 19,613 | 20,870 | 15,329 | 12,495 | 19,829 | |||||||||||
| Total nonperforming loans | 90,685 | 93,432 | 97,866 | 86,192 | 99,129 | |||||||||||
| Foreclosed real estate | 11,214 | 14,561 | 15,061 | 15,297 | 15,039 | |||||||||||
| Other repossessed assets | 4,617 | 3,307 | 2,533 | 2,625 | 1,945 | |||||||||||
| Total nonperforming assets | $ | 106,516 | $ | 111,300 | $ | 115,460 | $ | 104,114 | $ | 116,113 | ||||||
| Nonperforming Loan Rates | ||||||||||||||||
| Mortgage | 4.96 | % | 4.89 | % | 4.70 | % | 5.22 | % | 5.48 | % | ||||||
| Commercial | 1.40 | % | 1.55 | % | 1.98 | % | 1.55 | % | 1.80 | % | ||||||
| Consumer | 0.58 | % | 0.52 | % | 0.40 | % | 0.45 | % | 0.56 | % | ||||||
| Auto | 1.00 | % | 1.11 | % | 0.86 | % | 0.72 | % | 1.17 | % | ||||||
| Total loans | 1.61 | % | 1.71 | % | 1.81 | % | 1.66 | % | 1.98 | % |
OFG Bancorp (NYSE: OFG)
Table 6-3: Loan Information and Performance Statistics
| 2022 | 2022 | 2022 | 2022 | 2021 | ||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | |||||||||||||||||||||||||||||
| Nonperforming PCD Loans | (14) | |||||||||||||||||||||||||||||||||
| Mortgage | $ | 259 | $ | 260 | $ | 261 | $ | 310 | $ | 334 | ||||||||||||||||||||||||
| Commercial | 8,927 | 9,746 | 10,057 | 10,877 | 12,545 | |||||||||||||||||||||||||||||
| Total nonperforming loans | $ | 9,186 | $ | 10,006 | $ | 10,318 | $ | 11,187 | $ | 12,879 | ||||||||||||||||||||||||
| Nonperforming PCD Loan Rates | ||||||||||||||||||||||||||||||||||
| Mortgage | 0.03 | % | 0.02 | % | 0.02 | % | 0.03 | % | 0.03 | % | ||||||||||||||||||||||||
| Commercial | 5.61 | % | 6.01 | % | 5.77 | % | 5.71 | % | 6.14 | % | ||||||||||||||||||||||||
| Total | 0.77 | % | 0.81 | % | 0.80 | % | 0.83 | % | 0.92 | % | ||||||||||||||||||||||||
| Total PCD Loans Held for Investment | ||||||||||||||||||||||||||||||||||
| Mortgage | $ | 1,028,428 | $ | 1,059,448 | $ | 1,099,097 | $ | 1,144,364 | $ | 1,188,423 | ||||||||||||||||||||||||
| Commercial | 159,152 | 162,287 | 174,282 | 190,626 | 204,335 | |||||||||||||||||||||||||||||
| Consumer | 638 | 738 | 698 | 833 | 916 | |||||||||||||||||||||||||||||
| Auto | 5,658 | 7,152 | 8,788 | 10,765 | 13,281 | |||||||||||||||||||||||||||||
| Total loans | $ | 1,193,876 | $ | 1,229,625 | $ | 1,282,865 | $ | 1,346,588 | $ | 1,406,955 | 2022 | 2022 | 2022 | 2022 | 2021 | |||||||||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||||||||||||||||
| (Dollars in thousands) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | |||||||||||||||||||||||||||||
| Total Nonperforming Loans | (14) | |||||||||||||||||||||||||||||||||
| Mortgage | $ | 33,771 | $ | 33,485 | $ | 33,605 | $ | 37,085 | $ | 39,728 | ||||||||||||||||||||||||
| Commercial | 43,359 | 46,358 | 57,263 | 45,769 | 50,148 | |||||||||||||||||||||||||||||
| Consumer | 3,128 | 2,725 | 1,987 | 2,030 | 2,303 | |||||||||||||||||||||||||||||
| Auto | 19,613 | 20,870 | 15,329 | 12,495 | 19,829 | |||||||||||||||||||||||||||||
| Total nonperforming loans | $ | 99,871 | $ | 103,438 | $ | 108,184 | $ | 97,379 | $ | 112,008 | ||||||||||||||||||||||||
| Total Nonperforming Loan Rates | ||||||||||||||||||||||||||||||||||
| Mortgage | 1.98 | % | 1.93 | % | 1.86 | % | 2.01 | % | 2.08 | % | ||||||||||||||||||||||||
| Commercial | 1.65 | % | 1.83 | % | 2.21 | % | 1.83 | % | 2.11 | % | ||||||||||||||||||||||||
| Consumer | 0.58 | % | 0.52 | % | 0.40 | % | 0.45 | % | 0.56 | % | ||||||||||||||||||||||||
| Auto | 1.00 | % | 1.11 | % | 0.85 | % | 0.72 | % | 1.16 | % | ||||||||||||||||||||||||
| Total | 1.46 | % | 1.55 | % | 1.61 | % | 1.49 | % | 1.75 | % | ||||||||||||||||||||||||
| Total Loans Held for Investment | ||||||||||||||||||||||||||||||||||
| Mortgage | $ | 1,704,221 | $ | 1,739,279 | $ | 1,807,852 | $ | 1,848,641 | $ | 1,907,271 | ||||||||||||||||||||||||
| Commercial | 2,629,929 | 2,539,668 | 2,595,867 | 2,499,914 | 2,379,330 | |||||||||||||||||||||||||||||
| Consumer | 537,257 | 520,921 | 499,102 | 455,792 | 409,675 | |||||||||||||||||||||||||||||
| Auto | 1,963,915 | 1,885,097 | 1,799,840 | 1,743,624 | 1,706,310 | |||||||||||||||||||||||||||||
| Total loans | $ | 6,835,322 | $ | 6,684,965 | $ | 6,702,661 | $ | 6,547,971 | $ | 6,402,586 |
OFG Bancorp (NYSE: OFG)
Table 7: Allowance for Credit Losses
| Quarter Ended December 31, 2022 | ||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Mortgage | Commercial | Consumer | Auto | Total | |||||||||||
| Allowance for credit losses Non-PCD: | ||||||||||||||||
| Balance at beginning of period | $ | 10,431 | $ | 38,851 | $ | 24,233 | $ | 68,902 | $ | 142,417 | ||||||
| (Recapture of) provision for credit losses | (1,477) | 3,413 | 3,045 | 6,325 | 11,306 | |||||||||||
| Charge-offs | (8) | (3,444) | (a) | (5,069) | (10,380) | (18,901) | ||||||||||
| Recoveries | 625 | 338 | 1,055 | 5,001 | 7,019 | |||||||||||
| Balance at end of period | $ | 9,571 | $ | 39,158 | $ | 23,264 | $ | 69,848 | $ | 141,841 | ||||||
| Allowance for credit losses PCD: | ||||||||||||||||
| Balance at beginning of period | $ | 10,727 | $ | 1,886 | $ | 18 | $ | 114 | $ | 12,745 | ||||||
| (Recapture of) provision for credit losses | (1,863) | (750) | 105 | (82) | (2,590) | |||||||||||
| Charge-offs | (108) | (12) | (120) | (65) | (305) | |||||||||||
| Recoveries | 603 | 264 | 11 | 104 | 982 | |||||||||||
| Balance at end of period | $ | 9,359 | $ | 1,388 | $ | 14 | $ | 71 | $ | 10,832 | ||||||
| Allowance for credit losses summary: | ||||||||||||||||
| Balance at beginning of period | $ | 21,158 | $ | 40,737 | $ | 24,251 | $ | 69,016 | $ | 155,162 | ||||||
| (Recapture of) provision for credit losses | (3,340) | 2,663 | 3,150 | 6,243 | 8,716 | |||||||||||
| Charge-offs | (116) | (3,456) | (5,189) | (10,445) | (19,206) | |||||||||||
| Recoveries | 1,228 | 602 | 1,066 | 5,105 | 8,001 | |||||||||||
| Balance at end of period | $ | 18,930 | $ | 40,546 | $ | 23,278 | $ | 69,919 | $ | 152,673 | ||||||
| Allowance coverage ratio | 1.11 | % | 1.54 | % | 4.33 | % | 3.56 | % | 2.23 | % |
(a)Refer to “(b)” in Table 1-1.
OFG Bancorp (NYSE: OFG)
Table 8-1: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital
In addition to disclosing required regulatory capital measures, we also report certain non-GAAP capital measures that management uses in assessing its capital adequacy. These non-GAAP measures include tangible common equity ("TCE") and TCE ratio. The table below provides the details of the calculation of our regulatory capital and non-GAAP capital measures. While our non-GAAP capital measures are widely used by investors, analysts and bank regulatory agencies to assess the capital position of financial services companies, they may not be comparable to similarly titled measures reported by other companies.
| 2022 | 2022 | 2022 | 2022 | 2021 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Dollars in thousands) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | ||||||||||
| Stockholders' Equity to Non-GAAP Tangible Common Equity | |||||||||||||||
| Total stockholders' equity | $ | 1,042,406 | $ | 993,867 | $ | 1,014,812 | $ | 1,040,035 | $ | 1,069,160 | |||||
| Less: Intangible assets | (111,834) | (115,731) | (117,869) | (120,016) | (122,162) | ||||||||||
| Noncumulative perpetual preferred stock | — | — | — | — | — | ||||||||||
| Noncumulative perpetual preferred stock issuance costs | — | — | — | — | — | ||||||||||
| Tangible common equity | $ | 930,572 | $ | 878,136 | $ | 896,943 | $ | 920,019 | $ | 946,998 | |||||
| Common shares outstanding at end of period | 47,581 | 47,563 | 47,554 | 48,673 | 49,636 | ||||||||||
| Tangible book value per common share (Non-GAAP) | $ | 19.56 | $ | 18.46 | $ | 18.86 | $ | 18.90 | $ | 19.08 | |||||
| Total Assets to Tangible Assets | |||||||||||||||
| Total assets | $ | 9,818,780 | $ | 10,058,179 | $ | 10,247,774 | $ | 10,190,120 | $ | 9,899,720 | |||||
| Less: Intangible assets | (111,834) | (115,731) | (117,869) | (120,016) | (122,162) | ||||||||||
| Tangible assets (Non-GAAP) | $ | 9,706,946 | $ | 9,942,448 | $ | 10,129,905 | $ | 10,070,104 | $ | 9,777,558 | |||||
| Non-GAAP TCE Ratio | |||||||||||||||
| Tangible common equity | $ | 930,572 | $ | 878,136 | $ | 896,943 | $ | 920,019 | $ | 946,998 | |||||
| Tangible assets | 9,706,946 | 9,942,448 | 10,129,905 | 10,070,104 | 9,777,558 | ||||||||||
| TCE ratio | 9.59 | % | 8.83 | % | 8.85 | % | 9.14 | % | 9.69 | % | |||||
| Average Equity to Non-GAAP Average Tangible Common Equity | |||||||||||||||
| Average total stockholders' equity | $ | 1,025,132 | $ | 1,045,792 | $ | 1,032,270 | $ | 1,066,278 | $ | 1,066,764 | |||||
| Less: Average intangible assets | (114,412) | (116,612) | (118,750) | (120,874) | (123,201) | ||||||||||
| Average tangible common equity | $ | 910,720 | $ | 929,180 | $ | 913,520 | $ | 945,404 | $ | 943,563 |
OFG Bancorp (NYSE: OFG)
Table 8-2: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures (Continued)
| BASEL III | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Standardized | ||||||||||||||||||
| 2022 | 2022 | 2022 | 2022 | 2021 | ||||||||||||||
| (Dollars in thousands) (unaudited) | Q4 | Q3 | Q2 | Q1 | Q4 | |||||||||||||
| Regulatory Capital Metrics | ||||||||||||||||||
| Common equity Tier 1 capital | $ | 1,037,385 | $ | 995,342 | $ | 960,015 | $ | 955,221 | $ | 964,284 | ||||||||
| Tier 1 capital | 1,037,385 | 995,342 | 960,015 | 955,221 | 999,284 | |||||||||||||
| Total risk-based capital | (15) | 1,132,658 | 1,088,584 | 1,053,766 | 1,045,437 | 1,086,897 | ||||||||||||
| Risk-weighted assets | 7,605,466 | 7,440,482 | 7,499,171 | 7,214,692 | 7,004,876 | |||||||||||||
| Regulatory Capital Ratios | ||||||||||||||||||
| Common equity Tier 1 capital ratio | (16) | 13.64 | % | 13.38 | % | 12.80 | % | 13.24 | % | 13.77 | % | |||||||
| Tier 1 risk-based capital ratio | (17) | 13.64 | % | 13.38 | % | 12.80 | % | 13.24 | % | 14.27 | % | |||||||
| Total risk-based capital ratio | (18) | 14.89 | % | 14.63 | % | 14.05 | % | 14.49 | % | 15.52 | % | |||||||
| Leverage ratio | (19) | 10.36 | % | 9.82 | % | 9.46 | % | 9.54 | % | 9.69 | % | |||||||
| Common Equity Tier 1 Capital Ratio Under Basel III Standardized Approach | ||||||||||||||||||
| Total stockholders' equity | $ | 1,042,406 | $ | 993,867 | $ | 1,014,812 | (a) | $ | 1,040,035 | $ | 1,069,160 | |||||||
| Plus: CECL transition adjustment | (20) | 20,557 | 20,557 | 20,557 | 20,557 | 27,409 | ||||||||||||
| Less: Unrealized losses (gains) on available-for-sale securities, net of income tax | 93,663 | 104,145 | 49,606 | 20,522 | (5,663) | |||||||||||||
| Unrealized (gains) losses on cash flow hedges, net of income tax | (254) | (256) | (104) | 116 | 503 | |||||||||||||
| 1,156,372 | 1,118,313 | 1,084,871 | 1,081,230 | 1,091,409 | ||||||||||||||
| Less: Disallowed goodwill | (84,241) | (a) | (86,069) | (86,069) | (86,069) | (86,069) | ||||||||||||
| Disallowed other intangible assets, net | (20,279) | (21,617) | (22,997) | (24,384) | (25,771) | |||||||||||||
| Disallowed deferred tax assets, net | (14,467) | (15,285) | (15,790) | (15,556) | (15,285) | |||||||||||||
| Common equity Tier 1 capital | 1,037,385 | 995,342 | 960,015 | 955,221 | 964,284 | |||||||||||||
| Plus: Subordinated capital notes | — | — | — | — | 35,000 | |||||||||||||
| Tier 1 capital | 1,037,385 | 995,342 | 960,015 | 955,221 | 999,284 | |||||||||||||
| Plus tier 2 capital: Qualifying allowance for credit losses | 95,273 | 93,242 | 93,751 | 90,216 | 87,613 | |||||||||||||
| Total risk-based capital | $ | 1,132,658 | $ | 1,088,584 | $ | 1,053,766 | $ | 1,045,437 | $ | 1,086,897 |
(a)Refer to “(a)” in Table 3.
OFG Bancorp (NYSE: OFG)
Table 9: Notes to Financial Summary, Selected Metrics, Loans, and Consolidated Financial Statements (Tables 1 - 8)
| (1) | Total banking and financial service revenues. |
|---|---|
| (2) | Net interest income plus non-interest income, net (core) |
| (3) | Calculated based on net income available to common shareholders divided by average common shares outstanding for the period. |
| (4) | Calculated based on net income available to common shareholders divided by total average common shares outstanding and equivalents for the period as if converted. |
| (5) | Tangible book value per common share is a non-GAAP measure calculated based on tangible common equity divided by common shares outstanding. See "Tables 8-1 and 8-2: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures" for additional information. |
| (6) | Information includes all loans held for investment, including PCD loans. |
| (7) | Calculated based on annualized net interest income for the period divided by average interest-earning assets for the period. |
| (8) | Calculated based on annualized income, net of tax, for the period divided by average total assets for the period. |
| (9) | Calculated based on annualized income available to common shareholders for the period divided by average tangible common equity for the period. |
| (10) | Calculated based on non-interest expense for the period divided by total net interest income and total banking and financial services revenues for the period. |
| (11) | Calculated based on annualized net charge-offs for the period divided by average loans held for investment for the period. |
| (12) | Non-GAAP ratios. See "Tables 8-1 and 8-2: Reconciliation of GAAP to Non-GAAP Measures and Calculation of Regulatory Capital Measures" for information on the calculation of each of these ratios. |
| (13) | Production of new loans (excluding renewals). |
| (14) | Most PCD loans are considered to be performing due to the application of the accretion method, in which these loans will accrete interest income over the remaining life of the loans using estimated cash flow analyses. Therefore, they are not included as non-performing loans. PCD loan pools that are not accreting interest income are deemed to be non-performing loans and presented separately. |
| (15) | Total risk-based capital equals the sum of Tier 1 capital and Tier 2 capital. |
| (16) | Common equity Tier 1 capital ratio is a regulatory capital measure calculated based on Common equity Tier 1 capital divided by risk-weighted assets. |
| (17) | Tier 1 risk-based capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by risk-weighted assets. |
| (18) | Total risk-based capital ratio is a regulatory capital measure calculated based on Total risk-based capital divided by risk-weighted assets. |
| (19) | Leverage capital ratio is a regulatory capital measure calculated based on Tier 1 capital divided by average assets, after certain adjustments. |
| (20) | In March 2020, in light of recent strains on the U.S. economy as a result of the coronavirus disease 2019 (COVID-19), the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency issued an interim final rule that provided the option to temporarily delay the effects of CECL on regulatory capital for two years, followed by a three-year transition period. In addition, for the first two years, a uniform 25% “scaling factor” is introduced to approximate the portion of the post day-one allowance attributable to CECL relative to the incurred loss methodology. The 25% scaling factor is calibrated to approximate an overall after-tax impact of differences in allowances under CECL versus the incurred loss methodology. |
| (21) | Pre-provision net revenues is a non-GAAP measure calculated based on net interest income plus total non-interest income, net, less total non-interest expenses for the period. |
| (22) | Under the GNMA program, issuers such as OFG Bancorp have the option but not the obligation to repurchase loans that are 90 days or more past due. For accounting purposes, these loans subject to the repurchase option are required to be reflected (rebooked) on the financial statements of the Company with an offsetting liability. |
| (23) | PPP loans are fully guaranteed by the SBA and risk-weighted at 0%. |
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