- Improved Credit Quality metrics:
- Provision for loan and lease losses decreased $29.5 million to $59.2 million from $88.7 million.
- The level of non-performing loans decreased for the fifth consecutive quarter, the decline from the first quarter of 2011 was $25.0 million to $1.21 billion.
- The construction loans portfolio decreased $166.3 million, or 24%.
- Gain of $20.2 million realized on the sale of $303 million of U.S. agency mortgage-backed securities (“MBS”), compared to a gain of $18.7 million on the sale of $330 million of MBS in the first quarter.
- Gain of $6.8 million on the bulk sale of $282 million of performing residential mortgage loans, compared to a gain of $5.3 million on the sale of $236 million of performing residential mortgage loans in the first quarter.
- Non-cash charges of $1.5 million related to FirstBank’s investment in an unconsolidated joint venture.
- Fee income from broker-dealer activities rose $0.7 million.
- Net interest margin decreased 19 basis points to 2.64% and net interest income dec reased $11.8 million, mainly reflecting a decline in average earning assets and the continued maintenance of high levels of liquidity.
- Deposit mix improved with the planned reduction in brokered certificates of deposit (“CDs”) resulting in interest-bearing deposit funding costs of 1.85%, or 10 basis point lower than in the first quarter of 2011.
- Capital Plan execution:
- The Corporation entered into agreements to raise a total of $525 million in new capital from institutional investors and private equity firms, subject to stockholders’ and regulatory approvals. The transaction is expected to close during the third quarter of 2011.
- Balance sheet deleveraging strategies:
- Total assets decreased $990.1 million, or 6%, to $14.1 billion primarily related to the sale of investment securities and residential mortgage loans which proceeds were used in part to pay down brokered CDs and borrowings.
- Brokered CDs decreased by $514.2 million, or 8%.
- Total borrowings decreased $328.2 million, through, among other things, repayments of repurchase agreements and advances from FHLB prior to maturity.
- Total capital, Tier 1 capital and Leverage ratios were 12.40%, 11.08% and 8.04%, respectively, up from 11.97%, 10.65% and 7.78%, respectively.
- Regulatory Total capital, Tier 1 capital and Leverage ratios for FirstBank were 12.15%, 10.83% and 7.87%, respectively, up from 11.71%, 10.40%, and 7.60%, respectively.
- 4.93% Tier 1 common risk-based capital ratio, up from 4.82%.
- 3.84% tangible common equity ratio, up from 3.71%.
First BanCorp Reports Financial Results For The Quarter Ended June 30, 2011
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