Banco Popular ready to face Covid-19-fueled recession

(CB File)

Popular Inc. CEO says bank has sufficient reserves for ‘dramatic’ downturn

SAN JUAN – The head of Popular Inc.—the holding company of Banco Popular de Puerto Rico, the largest island-based bank—said his institution has built up enough reserves to endure losses resulting from the Covid-19 pandemic-induced deep recession expected in coming months.

Popular Inc. President and CEO Ignacio Álvarez told reporters during a recent virtual roundtable that the bank, which last year posted record core earnings, has almost doubled its reserves since December in anticipation of the economic impact of the novel coronavirus.

Popular Inc. President and CEO Ignacio Álvarez (Screen capture of

Even before the Covid-19 crisis, Banco Popular, as other U.S. banks, last year was required to switch its loss accounting methodology to Current Expected Credit Losses (CECL) accounting methodology.

CECL requires banks to forecast losses on the life of a loan as soon as they originate and record it on their balance sheet. Previously, banks did not record losses until an event persuaded them that a borrower may not be able to make loan payments in full. The new methodology requires shored up reserves but can cut into banks’ profitability.

Popular Inc. reported net income of $34.3 million for the first quarter of 2020, ended March 31, compared with net income of $166.8 million for the quarter ended Dec. 31, 2019. The provision for credit losses for the loans and investments portfolios, which reflects the adoption of CECL, was $189.7 million, including $134 million in incremental reserves due to the expected economic impact of Covid-19, according to Popular’s earnings report.

Gov. Wanda Vázquez’s implementation of the curfew/lockdown order on March 15 to curb the spread of Severe Acute Respiratory Syndrome Coronavirus 2 (SARS-CoV-2), the virus strain that causes Coronavirus Disease 2019 (Covid-19), impacted the revenue streams of Popular Inc., according to the report, which listed the reduced consumer transaction activity, the waiver of certain late fees and service charges, including ATM transaction fees, as well as the suspension in mortgage origination and related securitization and loan sale activities.

“In March, everything changed negatively,” Álvarez said during the roundtable, noting that the bank had to reduce business hours and channel most transactions to bank branch Autobanco drive-through windows. “That impact was not felt 100 percent in the operational part because our interest from income was greater. We had lower costs and we had quite solid operational results, taking into consideration that the second half of March was almost totally lost.”

‘Dramatic’ contraction, W-shaped recovery

The CEO said he expects a “dramatic” fall in Puerto Rico’s gross domestic product (GDP) in the second quarter, followed by a recovery progressing in fits and starts. The deep recession Puerto Rico and the states are sinking into will not be a typical economic downturn because of the nature of the crisis, Álvarez said.

“None of us have experienced something of this nature in our lives. We experienced the force of [Hurricane] Maria but we have had hurricanes before,” the executive said. “It is difficult to forecast how long the recovery will take because fundamentally this is a health problem. How fast the economy can reopen and how deep that recovery can be will depend greatly on advances in the field of health. If we have advances that are faster than expected, the economic impact will not be so bad, but if they take time, it will get worse.”

Álvarez said he is expecting a roller-coaster-like recovery due to the uncertainties surrounding the spread of Covid-19, which has yet to be contained.

“We see this more like a W-shaped recovery,” he said. “There will be a sharp fall in the economy in the second quarter, in the double digits in Puerto Rico as well as the states. It will be a dramatic fall—the biggest we have seen in our lives. What we foresee is that it will fall dramatically in the second quarter, rise a bit in the third quarter, fall again in the fourth quarter, and then go up again. This will not be a V-shaped recovery because it will take time.”

Despite the daunting economic fortunes ahead, Álvarez is confident that Banco Popular will come out ahead.

“That is why we have taken our reserves, and, obviously, our profitability will be affected. But even in these difficult times we think that even though we will be less profitable than normal, we will have earnings,” he said. “Thank God that we are in this situation with a level of capital we never had before. In effect, we almost doubled our reserves since December. We are very prepared, but, obviously, there is a lot of uncertainty.”

There are growing concerns that any economic recovery later this year could prove short-lived because of a possible resurgence of Covid-19 and a late spike in bankruptcies and defaults. Businesses and households that barely survived the current lockdown could go under later in the year.

In fact, Banco Popular has seen an influx of tens of thousands of requests for moratoriums from borrowers to put off monthly payments. Álvarez said the bank received more than 128,000 moratorium requests for loans in its portfolio, plus another 27,000 third-party mortgages involving entities such as the Federal National Mortgage Association (Fannie Mae).

The biggest portion of the moratorium requests involves auto loans (50,786), followed by mortgages (38,941), consumer credit borrowing involving credit cards and personal loans (34,665), and commercial loans (3,649), the bank executive said. The moratoriums allow customers to put off monthly installments for six months, while moratoriums for other loans allow for a four-month delay in payments.

“We have processed 78 percent of these requests. I think the number will be similar to what we had after [Hurricane] Maria,” Álvarez said.

Reopening of economy needed

Without presenting specific numbers to justify her decision, Gov. Vázquez announced last week an executive order to allow the reopening of much of the economic activity stopped a month and a half ago as the main measure to avoid the spread of Covid-19 on the island. Álvarez said such a lifting of restrictions on business is necessary because small and midsize enterprises (SMEs) cannot withstand the lockdown any longer. He acknowledged, however, that future Covid-19 contagion flare-ups could merit lockdown measures to be reinstated.

“Unfortunately we will have to learn to live with this virus for quite a long time,” he said, noting that the governor’s measures to control the spread of the virus deserved an “A-plus.”

“There will not be a vaccine for at least a year, and that would be a record in the history of vaccines,” the bank executive said. “We can’t close for a year because then we will all die of hunger. The question is how we can get out gradually, experimenting with and measuring the impact of these openings. And it is possible, if not probable, that we will have to open up a little, then close a little, then open back up again, until we better understand how this virus works.”

Álvarez said hard-hit SMEs cannot endure months-long lockdown measures.

“There has to be a balance between health and economic concerns,” he said, calling on the government to educate and “provide the tools” to Covid-19-proof workspaces. “You just can’t tell a 55-year-old small-business owner to keep his place shut and endure for health’s sake because it will not be so easy for him to recover. He could be impacted for the rest of his life.”

Sees silver lining in pandemic-ravaged economy

Certain industries will recover faster than others, Álvarez said, noting that he expects a slow recovery in the tourism, restaurant, movie and cruise industries, while the construction and manufacturing industries will bounce back faster.

Nevertheless, Álvarez said he remained optimistic about Puerto Rico’s long-term economic prospects due to the expected influx of federal aid money, which includes supplemental unemployment benefits that will often exceed worker earnings. The reshuffling of the global supply chains as a result of the pandemic will also open opportunities for the island, he said.

“There will be things that will help; there is a lot of federal stimulus money from Maria that has not been spent yet and has been obligated. There have been advances with that money,” he said.

The “dire impact on the economy” from Great Depression-era unemployment rates could be mitigated by the federal supplemental unemployment aid provided by the $2.2 trillion Coronavirus Aid, Relief and Economic Security Act (Cares Act), Álvarez said.

“In the United States, more than 50 percent of the people receiving unemployment will get more than they were paid while working. In Puerto Rico that number will be much higher,” he said. “People here who qualify for $150 a week in unemployment benefits, for example, will get $750,” he said. “That is something we have not figured out how to put into the economy model. Unemployment today, at least until the end of June, will not represent the same thing as traditional unemployment, which paid a fraction of what you earned.”

Álvarez said Puerto Rico has a “tremendous opportunity to leverage this crisis” and become a global hub not only for manufacturing and transportation, but also as a “safe” and “cheap” location for office workers and tourism.

“Something that will occur with this pandemic, and that had been occurring with the trade war with China, is that the global supply chains will never be the same for a long time. I think every country will determine that there are certain industries that are important for their national security, be it from the military or health point of view, that must be within their borders,” he said, adding that Puerto Rico’s manufacturing hub of pharmaceutical and medical device plants puts it in a good position to reap the benefits of this new outlook. “These manufacturing plants are already in Puerto Rico and it is easier for them to expand an existing facility than create a new plant. The dependence on China for these products will drop due to practical reasons the companies have or to government restrictions.”

Moreover, Álvarez said, the increase in remote office work could offer an opportunity to Puerto Rico to promote itself as a hospitable place that has a cost of living that is “not as high as in New York, Los Angeles or Miami.”

“That is going to be very interesting because work patterns are going to change,” he said.

And despite the current bleak prospects for tourism in a pandemic-ravaged world, Puerto Rico could still leverage its proximity and relative safety to attract stateside tourists once the crisis ends, Álvarez said.

“When this is over, people will be afraid of travelling too far; they will not want to be on a plane for 11 or 13 hours straight to go to Japan or China, especially with a face mask on,” he said. “If Puerto Rico promotes itself as a safe place, where [people in the states] can arrive here in three or four hours, this could work out for us. But that will take us longer because I think all type of travel will be limited. I have no doubt that people will begin to travel again, but it will take some time.”

He added: “After [the Sept. 11, 2001, terrorist attacks] people were saying that the world would never be the same and no one would travel, but after that people were travelling more than ever. As soon as a vaccine is out, people will want to travel again as they did before.”

Popular Inc. announces $34.3 million in net income for Q1

SAN JUAN – Popular Inc., the holding company of Banco Popular de Puerto Rico, reported net income of $34.3 million for the quarter ended March 31, compared to net income of $166.8 million for the quarter ended Dec. 31, 2019.

The corporation said the results reflect the impact during March of the business disruption and relief measures related to the Covid-19 pandemic.

“The provision for credit losses for the loans and investments portfolios, which reflects the adoption of CECL, was $189.7 million, including $134 million in incremental reserves due to the expected economic impact of COVID-19,” Popular’s earnings release reads.

The corporation explained that its revenue streams were impacted in the form of reduced consumer transaction activity, the waiver of certain late fees and service charges, including ATM transaction fees, as well as the suspension in mortgage origination and related securitization and loan sale activities.

According to the financial institution, those “revenue captions resulted in a decrease in income of approximately $6.8 million when compared to the previous quarter, reflecting the impact of the COVID-19 disruptions, mainly over the last two weeks of March. Furthermore, the Corporation has incurred in additional expenses related to front-line employee bonuses, the enabling of remote access for employees to work from home, the expansion of employee benefits, as well as the impact of specific measures to prevent the spread of the disease and efforts related to customer relief programs, among other related expenses.”

Ignacio Alvarez, president and CEO, said: “The COVID-19 global pandemic has exposed the fragility of our economic and social systems and the need for greater collaboration between all sectors. I am hopeful that it will also reveal what we can accomplish when we come together in pursuit of a common goal. At Popular, the well-being of our customers, employees and communities is our priority. We have acted decisively to help our employees stay safe while we continue to offer essential banking services to our customers and communities. We have submitted more than $1.2 billion in loans, representing more than 15,000 small and medium size businesses, under the SBA’s Payroll Protection Program. To date, we have received confirmation of SBA approval of $819 million of those submissions. We have also pledged more than $1 million dollars in support of COVID-19 emergency relief to non-profit organizations and health providers. I am deeply grateful to our colleagues for the efforts, commitment, and bravery exhibited under very difficult circumstances.

“Our net income for the quarter was significantly lower than the fourth quarter of 2019 and the same period last year. The primary driver of this decrease was a large increase in our provision expense, reflecting the newly adopted CECL methodology and the most recent post-COVID macroeconomic forecast for Puerto Rico and the U.S. Our operating results for the first quarter were solid considering the extent of the economic deceleration experienced during the second half of March. Net interest income, net interest margin as well as our net charge off ratio improved compared to the fourth quarter. We ended the quarter with a CET1 capital ratio of 15.8%

“During our 126 years, we have often operated in highly uncertain and volatile economic periods and have managed through them successfully. Almost three years ago we faced the impact of Hurricane Maria, which caused extensive damage and left Puerto Rico and the Virgin Islands without power, water and telecommunications, in some cases for months. We responded decisively, adapted to change and delivered positive results even under difficult conditions. While each situation has unique challenges, we have the team, the experience and the financial resources to do so again.

“Despite the uncertainty we are all facing as we fight this pandemic, we are confident that, with our strong liquidity position and capital levels, we are well prepared to successfully manage through the current challenges.”

The following highlights were published by the financial institution:

  • Net income of $34.3 million in Q1 2020, compared to net income of $166.8 million in Q4 2019.
  • Net interest margin of 3.94% in Q1 2020, compared to 3.83% in Q4 2019; Net interest margin on a taxable equivalent basis of 4.34% in Q1 2020, compared to 4.20% in Q4 2019.
  • Q1 2020 results reflect the impact of the adoption of the Current Expected Credit Losses (“CECL”) accounting standard.
  • Credit Quality:
    • Non-performing loans held-in-portfolio (“NPLs”) increased by $240.8 million from Q4 2019, mostly due to the effect of the adoption of CECL on previously acquired credit deteriorated loans; excluding this impact, NPLs decreased by $26.7 million; NPLs to loans ratio at 2.8% vs. 1.9% in Q4 2019;
    • Net charge-offs (“NCOs”) decreased by $19.4 million from Q4 2019; NCOs at 0.91% of average loans held-in-portfolio vs. 1.21% in Q4 2019;
    • Allowance for credit losses (“ACL”) to loans held-in-portfolio at 3.32% vs. 1.74% in Q4 2019; and
    • ACL to NPLs at 119.7% vs. 90.5% in Q4 2019.
  • Common Equity Tier 1 ratio of 15.79%, Common Equity per Share of $64.08 and Tangible Book Value per Share of $56.17 at March 31, 2020.

Popular Inc. chief approves governor’s efforts to stabilize Puerto Rico

(Rafelli González / CB)

President, CEO Álvarez says Gov. Vázquez ‘doing a good job’ following July crisis

SAN JUAN — The head of Puerto Rico’s largest banking institution said Wednesday that he thinks Gov. Wanda Vázquez Garced is “doing a good job” in bringing stability to the island while repairing its frayed relationship with Washington, D.C., after the public unrest in July that brought down former Gov. Ricardo Rosselló Nevarez and led to her taking office.

“I have to give a lot of credit to [Gov. Vázquez Garced]. She’s done a good job repairing relations with the feds, in regaining that trust,” Popular, Inc. President and CEO Ignacio Álvarez said during a roundtable with business journalists. Popular, Inc. is the holding company of Banco Popular de Puerto Rico, the island’s oldest and largest bank.

Contrary to former Gov. Rosselló Nevarez, who had “very established ideas and was not so open to listening to others,” Gov. Vázquez Garced is “more open” to suggestions and new ideas,” said Álvarez, who added that such an approach is critical to handle the complexity of the commonwealth’s fiscal crisis and allay investor concerns.

“Puerto Rico has received a lot of negative publicity, especially after hurricanes [Irma and Maria],” the bank executive said. “During the events of July, many investors could not make out what was going on here. Investments [only] continue to be made by those familiar with the island, such as those in medical devices and aerospace [industries].”

Álvarez cited, for example, the governor’s willingness to work with the Financial Oversight & Management Board (FOMB) and reconsider changes to Act 80 of 1976, the commonwealth’s unjustified dismissal statute, which the board wants repealed as part of its plans to restructure the island’s economy to make it more enticing to investors.

While the bank executive said he does not necessarily favor repealing Act 80, as Popular “can handle it well,” he believes it can be “improved.” He said the law has “killed off” small and mid-size businesses. 

Álvarez, who took over the helm of Popular fromRichard Carrión in 2017, said that to attract new investors to the island, the commonwealth needs to implement “structural changes” that go beyond austerity measures centered on across-the-board cuts in public employees and services, which he added “have not been done intelligently.”

“We have done very few structural changes. The business climate in Puerto Rico is not comparable to places like Ireland, Singapore and Costa Rica. It’s business as usual. The business climate here is not favorable,” the executive said, noting that the commonwealth still has to improve its permits process and economic planning. “People want things to change, but they don’t want to change the way things are done.”

Álvarez said that the latest local bank consolidations involving its two biggest competitors on the island – FirstBank and Oriental Bank – shows how the local banking market is adjusting to shifting international banking trends and changing island demographics, which includes a reduced population.

First BanCorp, the holding company of FirstBank Puerto Rico, announced last Monday the signing of a stock purchase agreement for the acquisition of Santander Bancorp, the holding company that includes Banco Santander Puerto Rico (BSPR), for about $1.1 billion in an all cash transaction. The transaction is expected to close in the middle of 2020, subject to regulatory approvals.

OFG Bancorp and Canadian financial institution Scotiabank announced in June the signing of a definitive agreement for OFG’s subsidiary, Oriental Bank, to acquire Scotiabank’s Puerto Rico operation for $550 million in cash and Scotiabank’s U.S. Virgin Island (USVI) branch operation for a $10 million deposit premium. The deal is expected to close by the end of this year.

The transactions would solidify FirstBank’s and Oriental Bank’s respective second and third place positions in the local retail banking market.

Álvarez said these consolidations will make these banks more competitive with Popular in the small and middle retail banking market, which he added has also been heavily serviced by credit unions. 

“I have been telling our employees that with these bank consolidations we will have to really knuckle down,” he said.

Face of Puerto Rico’s largest bank steps down from executive role

Richard Carrión (Eva LLoréns/CB)

Banco Popular’s Carrión transitions from executive chairman to non-executive chairman

SAN JUAN — Popular Inc. announced Friday that Richard L. Carrión will transition from his current role of executive chairman to non-executive chairman of the board, effective July 1.

Carrión was named executive chairman July 1, 2017, after serving as chairman since 1993 and CEO of Popular for 26 years, a role in which he was succeeded by Ignacio Álvarez.

Carrión, who joined the company in 1976, said: “Popular has had a special place in my heart since childhood and I have been blessed to serve it in different roles over the past four decades. With the organization stronger than ever, supported by a talented team under Ignacio’s leadership, this is the appropriate time for me to transition to a non-executive role. It is a privilege to continue my service to Popular as Chairman of the Board.”

Under Carrion’s leadership, Popular Inc. ranks among the top 50 U.S. bank holding companies by assets. Banco Popular de Puerto Rico provides retail, mortgage and commercial banking services in Puerto Rico and the U.S. Virgin Islands. It also offers auto and equipment leasing and financing, investment banking, broker-dealer and insurance services through specialized subsidiaries. Stateside, Popular provides retail, mortgage and commercial banking services through its New York-chartered banking subsidiary, Popular Bank, which has branches in New York, New Jersey and Florida.

“I know I speak for everyone in the Popular family in expressing my heartfelt appreciation to Richard for his many years of exemplary service. Richard has been a truly iconic leader and I am grateful for his mentorship and trust during this transition. We are fortunate to have the opportunity to continue to benefit from his guidance as Chairman of the Board,” Álvarez said in the release.

The illustrious banker earned a bachelor’s degree from the Wharton School of Finance and Commerce at the University of Pennsylvania and a master’s degree in Management Information Systems from the Massachusetts Institute of Technology.

Carrión served as president of Popular Inc. from 1990 to January 2009 and again from 2010 to 2014. He served as president of Banco Popular de Puerto Rico, Popular’s principal subsidiary, from 1985 until 2004. He also served as chairman and president of Puerto Rico Investors Tax-Free Fund Inc. I, II, III, IV and V from 1994 to 1998. He served as chairman and president of Puerto Rico Tax-Free Target, according to Bloomberg.

The veteran banker also served as chairman and president of Maturity Fund Inc. from 1996 to 1998 and II from 1997 to 1998. He served as chairman and president of Puerto Rico Investors Flexible Allocation Fund from December 1998 to January 1999.

He has been the chairman of the Board of Trustees at Banco Popular de Puerto Rico Foundation and Fundacion Banco Popular Inc. since 1982, and chairman and Director of Popular Community Bank Foundation Inc. since 2005. He has been a director of Banco Popular Foundation Inc. since 2005.

He also served as chairman of the Vall Banc S.A.U. He serves as a director of Financial Services Roundtable, of After School Matters Inc. and of Fort Dodge Animal Health S.p.A. (Fort Dodge Animal Health, Inc.).

He has been a member of the Board of Managers at EVERTEC Group LLC. He had been an independent director of Verizon Communications Inc. from 1997 to 2019. He serves as a director of American Home Products Corp. and of Verizon New York Inc.

Carrión serves on the board of First Bank Romania (formerly Piraeus Bank Romania), Vall Banc and NIBC Holding N.V. He has been a member of Supervisory Board NIBC Holding NV since 2017. He has been a director of Verizon New England Inc. since 1997.

Carrión served as a director at the Federal Reserve Bank of New York from January 2008 to 2016. He served as a director of NYNEX Corp. from 1995 to 1997; EVERTEC from 2010 to 2013 and Wyeth LLC from 2000 to 2006.

The executive served as director of Equity One Inc.; Popular Finance Inc.; Popular Auto Inc.; Popular Mortgage Inc.; Popular Securities Inc.; Popular Insurance Inc. and GM Group Inc.

He also served as a member of the board of the National Museum of American History, Smithsonian Institution, from 1997 to 1998. Carrión serves as the president of the Board of Trustees of the Puerto Rico Committee for Economic Development and participates in the boards of several other civic organizations.

Carrión has also been a member of the International Olympic Committee (IOC) since 1990 and served on its executive board from 2004 to 2012. In 2010, he was elected to the Central Board of the International Basketball Federation (FIBA).

“On behalf of a grateful Board, I would like to recognize Richard’s contributions, vision and his continued commitment to Popular, as well as Ignacio’s leadership since he assumed the position of CEO. We look forward to continue working with both to ensure Popular remains a strong, growing and vibrant organization,” William J. Teuber Jr., Popular lead independent director, said in the bank holding company’s announcement Friday.

The Banker names Popular ‘Bank of the Year Puerto Rico’

SAN JUAN -Popular Inc. announced Thursday that for the fifth consecutive year, Banco Popular de Puerto Rico (BPPR), its banking subsidiary, was recognized as a leading “Bank of the Year Americas” by The Banker, a financial intelligence magazine published by Financial Times Ltd.

Award judges had to decide which banks, from among 140 countries, deserved to be recognized in the publication’s 19th year of the rankings and awards. The institutions had to have delivered solid financial results while developing new products, services and the employment of new technology.

The Banker named Banco Popular “Bank of the Year Puerto Rico,” acknowledging the bank’s continued expansion and customer base growth, “racking up strong numbers in 2017,” a release reads.

The Banker noted that the bank saw a 17% increase in total deposits and added another 31,000 customers. Total assets reached $34.7 billion and market share in total deposits (net of brokered) and total loans increased to 52% and 43%, respectively. Of note for The Banker, is that the bank had to work under emergency conditions for months in the wake of hurricanes that struck the island in September 2017.

The Banker also shared that Popular became one of the first banks to use biometrics for authentication and was the first bank in Latin America to offer mobile payment and digital wallet service Samsung Pay.

This year, BPPR celebrated its 125th year anniversary.

“We are thrilled to receive this recognition on the heels of disaster recovery. At the heart of our success are our employees, whose steadfast commitment to Popular’s customers and communities have set us apart throughout our 125-year history,” said Ignacio Álvarez, president and CEO of Popular.

Popular Inc. is the leading financial institution in Puerto Rico, by both assets and deposits, and ranks among the top 50 U.S. bank holding companies by assets. Banco Popular provides retail, mortgage and commercial banking services in Puerto Rico and the U.S. Virgin Islands. It also offers in Puerto Rico auto and equipment leasing and financing, investment banking, broker-dealer and insurance services through specialized subsidiaries.

Popular Declares Dividends on its Preferred Stock

SAN JUAN – Puerto Rico-based Popular Inc., the bank holding company of Banco Popular, announced Friday that it had declared the following monthly cash dividends on its outstanding shares of Non-cumulative Monthly Income Preferred Stock: a monthly cash dividend of $0.1328125 per share of 6.375% Non-cumulative Monthly Income Preferred Stock, 2003 Series A, payable on June 30, 2016, to holders of record as of June 15, 2016; and a monthly cash dividend of $0.171875 per share of 8.25% Non-cumulative Monthly Income Preferred Stock, Series B, payable on June 30, 2016, to holders of record as of June, 15, 2016.

The corporation also announced the following monthly distributions on its outstanding Trust Preferred Securities: a monthly distribution of $0.1395833 per security of 6.7% Cumulative Monthly Income Trust Preferred Securities issued by Popular Capital Trust I, payable on July 1, 2016, to holders of record as of June 15, 2015; and a monthly distribution of $0.127604 per security of 6.125% Cumulative Monthly Income Trust Preferred Securities issued by Popular Capital Trust II, payable on July 1, 2016 to holders of record as of June 15, 2016.

Popular is the leading banking institution by both assets and deposits in Puerto Rico and ranks among the top 50 U.S. banks by assets. 



Popular Declares Cash Dividend of $0.15 per Common Share

SAN JUAN – Puerto Rico-based Popular Inc. announced Friday that its board has approved a quarterly cash dividend of $0.15 per share on its outstanding common stock. The dividend will be payable on April 1 to shareholders of record at the close of business on March 11. 

Popular is the leading banking institution by both assets and deposits in Puerto Rico and ranks among the top 50 U.S. banks by assets. It provides retail, mortgage and commercial banking services through its principal banking subsidiary, Banco Popular de Puerto Rico, as well as auto and equipment leasing and financing, investment banking, broker-dealer and insurance services through specialized subsidiaries. In the mainland United States, Popular has a community-banking franchise with branches in New York, New Jersey and Florida under the name of Popular Community Bank.

Banker Carrión Favors Creation of Fiscal Control Board

Richard Carrión, Popular Inc. CEO

Popular Inc. CEO Richard Carrión

SAN JUAN – The CEO of Popular Inc., Richard Carrión, on Saturday favored the creation of a fiscal control board to find solutions to the crisis caused by the inability to pay the Puerto Rico government’s debt.

“When I testified in the U.S. Senate, I said I was ashamed to be there because we allowed things to reach this point,” Carrión told reporters during the inauguration of the new Club Sparta facilities, in which he invested to provide a locale in where olympic wrestling training will be conducted.

The banking institution’s CEO added, “I think it will take three things, three essential things; it will require some kind of legal framework to restructure the debt, it will require some type of fiscal control board to ensure discipline with the commitments and the budget, and it will require some form of economic stimulus.

“Without economic stimulus, none of these things work. So I think the three things are necessary, none alone is sufficient.”

He also said that “it is shameful that we are at this point, but it is imperative that we move forward and make sure something like this never happens.”

Regarding the control board, he stressed that “it must be an independent board; more than a federal one, it must be an independent board, free of political pressure, because it will not be an easy job.”