First BanCorp posts $24.1 million net income in third quarter
SAN JUAN – First BanCorp, the bank holding company for FirstBank Puerto Rico, on Tuesday reported net income of $24.1 million for the third quarter (3Q) of 2016, or $0.11 per diluted share, compared with $22 million, or $0.10 per diluted share, for 2Q of 2016 and $14.8 million, or $0.07 per diluted share, for 3Q of 2015.
“We posted another positive quarter of earnings, $24.1 million or $0.11 per diluted share compared with $22 million in the second quarter. Our pre-tax pre-provision income was $50.2 million, in line with prior quarters,” Aurelio Alemán, president and CEO of First BanCorp, commented on the results.
Alemán said First BanCorp’s franchise metrics continue to progress in the right direction: efficiency improvement, core deposit growth and deposit mix, and were successful in executing strategies to achieve loan origination and renewal targets, which increased 11% to $898 million in 3Q, the highest level since 2014, he said.
While the bank’s asset quality remains challenging with a higher level of charge-offs this quarter, Alemán noted First BanCorp was able to reduce nonperforming assets and experienced a decline in adverse migration.
“During the third quarter we opportunistically repositioned our balance sheet, which should drive future profitability. Total assets declined this quarter by $433 million due to our utilization of cash and securities to repay maturing brokered CDs, repurchase agreements, and FHLB advances. As part of this repositioning, the sale of $198.7 million of mortgage-backed securities (MBS) resulted in pre-tax gain of $6.1 million,” Alemán indicated.
With respect to the results of the 2016 Dodd-Frank Act Stress Tests, which the bank completed in 2Q and published Monday, Alemán said that under the severely adverse scenario model, which the bank isn’t currently in nor anticipates being in during the near future, First BanCorp’s pro-forma resulting capital ratios significantly continue to exceed regulatory well-capitalized requirements.
“This sophisticated process continues to assist us in capital planning decisions and ensuring the proper risk measures are in place, and demonstrates the strength of our core franchise,” Alemán said.