Popular, Inc. (the “Corporation” or “Popular”) (NASDAQ:BPOP) reported net income of $163.0 million for the quarter ended December 31, 2013, compared to net income of $229.1 million for the quarter ended September 30, 2013.
Mr. Richard L. Carrión, Chairman of the Board and Chief Executive Officer, said: “The earnings for the fourth quarter demonstrate how the strength of our franchise continues to produce positive results even in a challenging operating environment. Over the last few years, we have executed a number of strategic initiatives that have improved our operational and financial metrics and will position us to further increase profitability once the economy in Puerto Rico begins to improve.”
|Quarters ended||Years ended|
|(Dollars in thousands, except per share information)||31-Dec-13||30-Sep-13||31-Dec-12||31-Dec-13||31-Dec-12|
|Net interest income||$ 376,342||$ 354,206||$ 351,417||$ 1,432,580||$ 1,376,633|
|Provision for loan losses – non-covered loans||47,729||55,230||86,256||533,167||334,102|
|Provision (reversal) for loan losses – covered loans ||8,907||17,433||(3,445)||69,396||74,839|
|Net interest income after provision for loan losses||319,706||281,543||268,606||830,017||967,692|
|FDIC loss share expense||(37,164)||(14,866)||(36,824)||(82,051)||(56,211)|
|Other non-interest income||228,354||306,825||187,304||892,620||587,423|
|Income before income tax||188,193||246,903||103,854||348,000||218,872|
|Income tax expense (benefit)||25,162||17,768||19,914||(251,327)||(26,403)|
|Net income||$ 163,031||$ 229,135||$ 83,940||$ 599,327||$ 245,275|
|Net income applicable to common stock||$ 162,100||$ 228,204||$ 83,009||$ 595,604||$ 241,552|
|Net income per common share - basic||$ 1.58||$ 2.22||$ 0.81||$ 5.80||$ 2.36|
|Net income per common share - diluted||$ 1.57||$ 2.22||$ 0.81||$ 5.78||$ 2.35|
| Covered loans represent loans acquired in the Westernbank FDIC-assisted transaction that are covered under FDIC loss sharing agreements.|
Recent significant events
- On December 13, 2013, the Corporation completed the sale of 5,800,000 shares of common stock of EVERTEC, resulting in an after-tax gain of $99.4 million. The shares were sold to the public as part of an underwritten public offering of 15,233,273 shares of EVERTEC’s common stock at a price of $20.60 per share. The selling stockholders included an affiliate of Apollo Global Management, LLC (“Apollo”), Popular, Inc., and certain officers and employees of EVERTEC. Apollo sold 9,205,743 shares of EVERTEC, with the offering. Following the sale, Popular retained a stake of 14.9% in EVERTEC.
As part of the transaction, EVERTEC repurchased from the underwriters 3,690,036 shares of its common stock being sold by the selling stockholders in the offering, resulting in a reduction in its capital of approximately $75.0 million. Popular’s share of approximately $11.0 million was reflected as a reduction in its investment in EVERTEC.