First BanCorp Commences Preferred Stock Exchange Offer

First BanCorp. (the “Corporation”) (NYSE: FBP), the bank holding company for FirstBank Puerto Rico (“FirstBank” or “the Bank”), announced today that it has commenced an offer to exchange (the “Exchange Offer”) up to 10,087,488 newly issued shares of its common stock, par value $0.10 per share (“Common Stock”), for any and all of the issued and outstanding shares of: (i) $11,254,875 in aggregate liquidation preference of its 7.125% Noncumulative Perpetual Monthly Income Preferred Stock, Series A (CUSIP 318672201); (ii) $11,899,675 in aggregate liquidation preference of its 8.35% Noncumulative Perpetual Monthly Income Preferred Stock, Series B (CUSIP 318672300); (iii) $11,515,275 in aggregate liquidation preference of its 7.40% Noncumulative Perpetual Monthly Income Preferred Stock, Series C (CUSIP 318672409); (iv) $12,764,800 in aggregate liquidation preference of its 7.25% Noncumulative Perpetual Monthly Income Preferred Stock, Series D (CUSIP 318672508); and (v) $15,612,175 in aggregate liquidation preference of its 7.00% Noncumulative Perpetual Monthly Income Preferred Stock, Series E (CUSIP 318672607) (collectively, “Preferred Stock”).

The Exchange Offer will expire at 5:00 p.m., Eastern Standard Time, on Monday, March 18, 2013 (the “Expiration Date”) unless extended or earlier terminated by the Corporation. Holders of shares of Preferred Stock must validly tender their shares for exchange in the Exchange Offer on or prior to the Expiration Date to receive shares of Common Stock. To participate in the Exchange Offer, tendering holders of Preferred Stock must grant a proxy permitting the proxyholders to execute a written consent in favor of an amendment to the certificate of designation for the Preferred Stock, except if the holder is not a holder of shares of Preferred Stock as of the record date. The Board of Directors will set the record date for determining holders of Preferred Stock entitled to grant their proxy as March 11, 2013, the date that is five business days before the Expiration Date.

The Corporation will issue a number of shares of Common Stock in exchange for each share of Preferred Stock accepted for exchange based on an exchange value of $20 per share of Preferred Stock divided by the higher of (1) the average Volume Weighted Average Price, or “VWAP,” of a share of Common Stock, during the five trading-day period ending on the second business day immediately preceding the Expiration Date of the Exchange Offer and (2) $5 per share of Common Stock. No more than 4 shares of Common Stock will be issued in exchange for each share of Preferred Stock that the Corporation accepts for tender in the Exchange Offer. The price per share for purposes of determining the number of shares of the Corporation’s Common Stock that will be issued for each share of Preferred Stock accepted in the Exchange Offer (the “Relevant Price”) will be fixed at 4:00 p.m., Eastern Standard Time, on the second business day immediately preceding the Expiration Date of the Exchange Offer and will be announced prior to 9:00 a.m., Eastern Standard Time, on the immediately succeeding business day. Depending on the trading price of the Common Stock compared to the Relevant Price, the market value of the Common Stock on the date that it is issued in exchange for each share of Preferred Stock that the Corporation accepts for exchange, that is, the settlement date, may be less than or equal to or greater than the applicable exchange value.

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