Popular Debt Exchange Results In $934M In Offers

SAN JUAN, Puerto Rico (AP) — Banking company Popular Inc. said Friday its offer to exchange common stock for preferred shares resulted in $934.1 million in tendered securities.

The company had previously said it would issue up to 390 million shares of common stock for the exchange. The offer expired Thursday.

The company said the exchange offer was designed to increase its common equity capital to accommodate the more adverse economic and credit scenarios assumed by U.S. Government regulators.

"This exchange offer was a difficult decision but necessary given the current state of the economy in the United States and Puerto Rico," CEO Richard L. Carrion said. "The corporation is now well positioned in the event a worse-than-expected business environment materializes in the future."

Popular, parent of Banco Popular, like most banks, has been facing mounting loan losses amid the ongoing recession and downturn in the housing market. It has also been hit hard by losses on investments tied to mortgages, which have hurt its profitability during the credit crisis and current downturn.

Shares rose 11 cents, or 6.4 percent, to $1.82 in afternoon trading.