Quarterly Results 4Q20 Conference Call January 25, 2020 Forward Looking Statements The information included in this document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements. Factors that might cause such a difference include, ...

[PART I – FINANCIAL INFORMATION](index=7&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) [Financial Statements](index=7&type=section&id=Item%201.%20Financial%20Statements) This section presents OFG Bancorp's unaudited consolidated financial statements, including key financial positions, operational results, and cash flows, along with notes on significant accounting policies and recent acquisitions [Unaudited Consolidated Statements of Financial Condition](index=7&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Financial%20Condition) Total assets increased to **$10.02 billion** by September 30, 2020, driven by a significant rise in cash and cash equivalents, while total deposits grew by **12.1%** to **$8.63 billion** and stockholders' equity modestly increased to **$1.06 billion** Consolidated Balance Sheet Highlights (in thousands) | Account | September 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total Assets** | **$10,018,991** | **$9,297,661** | | Cash and cash equivalents | $2,282,000 | $851,307 | | Total investments | $434,364 | $1,087,814 | | Total loans, net | $6,579,140 | $6,641,847 | | Goodwill | $86,069 | $86,069 | | **Total Liabilities** | **$8,954,669** | **$8,252,183** | | Total deposits | $8,632,457 | $7,698,610 | | Total borrowings | $102,864 | $305,561 | | **Total Stockholders' Equity** | **$1,064,322** | **$1,045,478** | [Unaudited Consolidated Statements of Operations](index=9&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Operations) Net income for Q3 2020 significantly increased to **$25.8 million** or **$0.50 per diluted share**, primarily driven by a **23.3%** rise in net interest income and a **68.8%** decrease in the provision for credit losses Quarterly Statement of Operations Highlights (in thousands, except per share data) | Metric | Q3 2020 | Q3 2019 | | :--- | :--- | :--- | | Net Interest Income | $99,533 | $80,710 | | Provision for Credit Losses | $13,669 | $43,770 | | Non-interest Income, net | $31,326 | $22,178 | | Non-interest Expense | $83,444 | $50,727 | | **Net Income** | **$27,438** | **$7,383** | | **Diluted EPS** | **$0.50** | **$0.11** | [Unaudited Consolidated Statements of Cash Flows](index=13&type=section&id=Unaudited%20Consolidated%20Statements%20of%20Cash%20Flows) Cash, cash equivalents, and restricted cash increased by **$1.43 billion** for the nine months ended September 30, 2020, primarily driven by a **$915.1 million** net increase in deposits and **$747.3 million** from investing activities, partially offset by operating cash usage Nine-Month Cash Flow Summary (in thousands) | Cash Flow Category | Nine-Month Period Ended Sep 30, 2020 | | :--- | :--- | | Net cash (used in) provided by operating activities | $(12,266) | | Net cash provided by investing activities | $747,339 | | Net cash provided by (used in) financing activities | $695,220 | | **Net change in cash, cash equivalents and restricted cash** | **$1,430,293** | [Notes to Unaudited Consolidated Financial Statements](index=16&type=section&id=Notes%20to%20Unaudited%20Consolidated%20Financial%20Statements) These notes provide critical details on accounting policies, business combinations, and financial statement items, highlighting the adoption of the CECL standard and the financial impact of the Scotiabank acquisition - The company adopted the new CECL credit loss standard (ASU 2016-13) on January 1, 2020, using a modified retrospective method, resulting in an after-tax cumulative effect reduction to retained earnings of **$25.5 million**[46](index=46&type=chunk)[47](index=47&type=chunk) - In response to the COVID-19 pandemic, the company offered payment deferral programs for its loan portfolios, with most not being classified as Troubled Debt Restructurings (TDRs) as guided by the CARES Act and interagency statements[41](index=41&type=chunk)[80](index=80&type=chunk) - During the nine-month period ended September 30, 2020, the company recorded remeasurement adjustments related to the Scotiabank acquisition, resulting in a bargain purchase gain of **$7.3 million**[85](index=85&type=chunk)[86](index=86&type=chunk) - As of September 30, 2020, the company and its bank subsidiary met all capital adequacy requirements and were categorized as "well capitalized" under the regulatory framework[195](index=195&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=79&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance and condition, highlighting a strong third quarter driven by an improved macroeconomic environment and successful integration of the Scotiabank acquisition, alongside analysis of key financial metrics and the impact of the COVID-19 pandemic [Financial Highlights of the Third Quarter of 2020](index=86&type=section&id=Financial%20Highlights%20of%20the%20Third%20Quarter%20of%202020) Q3 2020 showed strong performance with diluted EPS increasing to **$0.50**, driven by lower provision for credit losses and reduced non-interest expenses, alongside robust customer deposit growth and loan production - Diluted EPS for Q3 2020 was **$0.50**, a **28%** increase from Q2 2020 and a **355%** increase from Q3 2019[312](index=312&type=chunk) - Provision for credit losses decreased **23%** from Q2 2020 to **$13.7 million**, with loan payment deferrals related to COVID-19 dropping significantly to **2.0%** of total loans from **30.0%** in the previous quarter[312](index=312&type=chunk) - Customer deposits grew by **$212.6 million** during the quarter to **$8.5 billion**, leading to a **$383.0 million** increase in cash[312](index=312&type=chunk) - All regulatory capital ratios remained significantly above requirements for a well-capitalized institution, with the CET1 ratio at **12.55%**[314](index=314&type=chunk) [Analysis of Results of Operations](index=87&type=section&id=Analysis%20of%20Results%20of%20Operations) Q3 2020 net interest income increased by **$18.8 million** YoY to **$99.5 million**, driven by higher loan balances despite a lower net interest margin, while non-interest income and expenses also rose significantly due to the Scotiabank acquisition, and provision for credit losses decreased substantially - Q3 2020 net interest income increased **23.3%** YoY to **$99.5 million**, primarily due to higher loan volumes from the Scotiabank acquisition, which offset a decline in net interest margin from **5.35%** to **4.30%**[324](index=324&type=chunk)[326](index=326&type=chunk) - Q3 2020 non-interest income increased by **$9.1 million** (**41.2%**) YoY, driven by a **$5.5 million** increase in banking service revenues and a **$2.8 million** increase in mortgage-banking activities, both benefiting from the larger customer base post-acquisition[331](index=331&type=chunk)[332](index=332&type=chunk) - Q3 2020 non-interest expense increased by **$32.7 million** (**64.5%**) YoY, with significant increases in compensation, occupancy, and technology costs directly related to the integration of Scotiabank's operations[338](index=338&type=chunk)[340](index=340&type=chunk) - The provision for credit losses in Q3 2020 was **$13.7 million**, a sharp decrease from **$43.8 million** in Q3 2019, as the prior-year quarter included a large provision related to a sale of non-performing loans[342](index=342&type=chunk) [Analysis of Financial Condition](index=103&type=section&id=Analysis%20of%20Financial%20Condition) As of September 30, 2020, total assets grew **7.8%** to **$10.0 billion**, driven by increased cash and deposits, while the loan portfolio remained stable, and non-performing assets increased due to the new CECL methodology - Total assets grew by **7.8%** to **$10.0 billion** from year-end 2019, driven by a **168%** increase in cash and due from banks, funded by a **12.2%** growth in total deposits[362](index=362&type=chunk)[373](index=373&type=chunk)[407](index=407&type=chunk) - The loan portfolio composition at September 30, 2020 was **35.9%** commercial, **34.8%** mortgage, **22.8%** auto, and **6.5%** consumer[375](index=375&type=chunk) - Non-performing assets increased to **$215.2 million** (**2.15%** of total assets) from **$118.7 million** (**1.28%** of total assets) at year-end 2019, mainly as a result of the new CECL methodology for PCD loans[387](index=387&type=chunk) - Tangible book value per common share increased to **$16.51** from **$15.96** at year-end 2019, with all regulatory capital ratios improving and remaining well above 'well-capitalized' minimums[412](index=412&type=chunk)[413](index=413&type=chunk) [Quantitative and Qualitative Disclosures about Market Risk](index=125&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) The company primarily manages interest rate risk, with simulations showing a **100 basis point** rate increase could boost net interest income by **$11.7 million**, while also addressing significant credit risk concentrated in Puerto Rico and maintaining strong liquidity through diverse funding sources Net Interest Income Sensitivity (One-Year Projection, in millions) | Change in Interest Rate | Static Balance Sheet Change | Dynamic Balance Sheet Change | | :--- | :--- | :--- | | +200 Basis points | +$24.9M (+6.39%) | +$20.6M (+5.28%) | | +100 Basis points | +$13.9M (+3.57%) | +$11.7M (+2.98%) | | -50 Basis points | -$4.4M (-1.13%) | -$3.8M (-0.98%) | - Credit risk is a primary concern due to the concentration of business in Puerto Rico, which faces a protracted economic recession, government fiscal crisis, and the impacts of natural disasters and the COVID-19 pandemic[442](index=442&type=chunk) - As of September 30, 2020, the company maintained a strong liquidity position with approximately **$2.3 billion** in unrestricted cash and cash equivalents and **$992.2 million** in additional borrowing capacity at the FHLB-NY[453](index=453&type=chunk) [Controls and Procedures](index=129&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of September 30, 2020, while actively integrating internal controls from the Scotiabank acquisition and implementing new controls for the CECL accounting standard - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the reporting period[461](index=461&type=chunk) - The company is actively integrating the policies, processes, and internal controls from the Scotiabank PR & USVI Acquisition, with completion expected by December 31, 2020, and new controls were implemented for the adoption of the CECL accounting standard[462](index=462&type=chunk) [PART II – OTHER INFORMATION](index=131&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) [Legal Proceedings](index=131&type=section&id=Item%201.%20Legal%20Proceedings) The company and its subsidiaries are involved in various legal proceedings, but management believes the ultimate liability will not materially affect financial condition or results of operations - Oriental and its subsidiaries are defendants in a number of legal proceedings incidental to their business, but management does not expect the outcomes to have a material adverse effect on the company's financial condition[464](index=464&type=chunk) [Risk Factors](index=131&type=section&id=Item%201A.%20Risk%20Factors) This section supplements existing risk factors, focusing on the significant and uncertain impacts of the COVID-19 pandemic, including potential adverse effects on business results, financial condition, liquidity, and capital, as well as operational challenges - The COVID-19 pandemic has adversely impacted the business, and the full extent of future impacts on financial condition, liquidity, and results of operations remains highly uncertain and difficult to predict[466](index=466&type=chunk) - The pandemic could lead to higher credit losses and increases in the allowance for credit losses, with a substantial build in the allowance already recorded for the nine months ended September 30, 2020, due to economic uncertainty[468](index=468&type=chunk) - The company has modified business practices, including implementing work-from-home policies for approximately **50%** of employees, which could impair the ability to perform critical functions[469](index=469&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=132&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) Under its stock repurchase program, the company purchased **175,000** shares of common stock for **$2.2 million** during the nine-month period ended September 30, 2020, with approximately **$5.5 million** remaining available for future repurchases Stock Repurchase Activity (Nine-Month Period Ended Sep 30, 2020) | Period | Total Shares Purchased | Average Price Paid | Value of Shares Remaining for Purchase | | :--- | :--- | :--- | :--- | | March 1-31, 2020 | 175,000 | $12.69 | $5,510,000 |

OFG Bancorp (NYSE:OFG) Q3 2020 Earnings Conference Call October 22, 2020 10:00 AM ET Company Participants Jose Fernandez - President, CEO and Vice Chairman Maritza Arizmendi - EVP and CFO Conference Call Participants Alex Twerdahl - Piper Sandler Joe Gladue - Alden Securities Glen Manna - Keefe, Bruyette & Woods Operator Good morning. Thank you for joining OFG Bancorp’s Conference Call. My name is Maria, and I will be your operator today. Our speakers are, Jose Rafael Fernandez, President, Chief Executive O ...

Quarterly Results 3Q20 Conference Call October 23, 2020 Forward Looking Statements The information included in this document contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based on management's current expectations and involve certain risks and uncertainties that may cause actual results to differ materially from those expressed in the forward-looking statements. Factors that might cause such a difference include, ...

Financial Performance - Net income for the quarter ended June 30, 2020, was $21,787,000, a decrease of 9.1% compared to $23,979,000 in the same quarter of 2019[26]. - Earnings per common share for the quarter was $0.39, down from $0.44 in the same quarter of 2019, representing a decrease of 11.4%[24]. - Comprehensive income for the quarter ended June 30, 2020, was $23,085,000, a decrease of 18.5% from $28,340,000 in the prior year[26]. - The company reported a net gain of $3,462 thousand from the bargain purchase related to the Scotiabank PR & USVI acquisition[22]. - The company reported a total of $1,393.9 million in carrying amount for acquired loans with deteriorated credit quality as of December 31, 2019[107]. Assets and Liabilities - Total assets increased to $9,932,719 thousand as of June 30, 2020, up from $9,297,661 thousand at December 31, 2019, representing a growth of 6.8%[17]. - Total liabilities increased to $8,891,435 thousand, up from $8,252,183 thousand at the end of 2019, representing a rise of 7.8%[20]. - Stockholders' equity slightly decreased to $1,041,284 thousand from $1,045,478 thousand at December 31, 2019[20]. - Cash and cash equivalents totaled $1,898,987 thousand as of June 30, 2020, significantly up from $851,307 thousand at December 31, 2019, indicating a growth of 123.5%[17]. - The total cash, cash equivalents, and restricted cash at the end of the period reached $1,900,037 thousand, up from $677,430 thousand at the end of the same period in 2019, representing a growth of 180.5%[33]. Deposits and Interest Income - Total deposits rose to $8,541,926 thousand, an increase of 11% from $7,698,610 thousand at the end of 2019[20]. - Net interest income for the quarter ended June 30, 2020, was $105,060 thousand, a 29.5% increase compared to $81,085 thousand for the same period in 2019[22]. - The weighted average interest rate of deposits was 0.82% as of June 30, 2020, slightly down from 0.86% as of December 31, 2019[163]. - Interest expense for the six-month period ended June 30, 2020, was $32.1 million, compared to $19.0 million for the same period in 2019, indicating a significant increase[163]. Credit Losses and Provisions - Provision for credit losses was $17,696 thousand for the quarter, slightly down from $17,705 thousand in the same quarter of the previous year[22]. - Provision for credit losses rose significantly to $64,827,000 for the six-month period ended June 30, 2020, compared to $29,954,000 in the same period of 2019, reflecting a 116.5% increase[31]. - The allowance for credit losses was $232.7 million, reflecting an increase of $81.2 million compared to the previous period[102]. - The provision for credit losses for the quarter ended June 30, 2020, was $15.2 million, which included a charge-off of $18.2 million and recoveries of $4.5 million[142]. Loan Portfolio - Loans held for investment increased to $6,719,811 thousand, up from $6,622,256 thousand at December 31, 2019, reflecting a growth of 1.5%[17]. - The total loans, net, stood at $6,739.2 million, with a significant portion attributed to the auto loan segment, which accounted for $1,454.9 million[102]. - The total loans past due represented approximately 4.1% of the total loans held for investment as of June 30, 2020[105]. - The aging of loans held for investment showed a total of $276.9 million in loans past due as of June 30, 2020, with $145.4 million in loans 30-59 days past due and $72.1 million in loans 60-89 days past due[105]. Acquisitions and Mergers - Oriental acquired Scotiabank de Puerto Rico for an aggregate purchase price of $550 million, merging it with Oriental Bank immediately after the acquisition[81]. - As of June 30, 2020, Oriental's total identifiable assets acquired from the Scotiabank acquisition were valued at $3.56 billion, with total identifiable net assets of $434.6 million[83]. - The merger and restructuring charges related to the Scotiabank acquisition amounted to $3.006 million for the quarter ended June 30, 2020, and $3.310 million for the six-month period[85]. Tax and Regulatory Compliance - The effective tax rate for the six-month period ended June 30, 2020, was 24.2%, down from 32.1% for the same period in 2019[184]. - Oriental's total unrecognized tax benefits decreased from $2.7 million as of December 31, 2019, to $1.2 million as of June 30, 2020[185]. - As of June 30, 2020, OFG Bancorp and the Bank met all capital adequacy requirements and were categorized as "well capitalized" under regulatory standards[193]. - The minimum capital ratios required under Basel III include 4.5% CET1 to risk-weighted assets and 6.0% Tier 1 capital to risk-weighted assets[189]. Strategic Initiatives - The company plans to continue focusing on strategic initiatives to enhance operational efficiency and market expansion[25]. - The company has implemented various loan modification programs in response to the economic impacts of Covid-19, with most modifications not classified as troubled debt restructurings (TDRs)[77].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File Number 001-12647 OFG Bancorp Incorporated in the Commonwealth of Puerto Rico, IRS Employer Identification No. ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 Form 10-K ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2019 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File No. 001-12647 OFG Bancorp Incorporated in the Commonwealth of Puerto Rico IRS Employer Identification No. 66-0538893 Principal E ...

Financial Performance - Interest income for Q3 2019 was $93,655,000, a decrease of 0.5% from $94,137,000 in Q3 2018, while net interest income decreased by 1.9% to $80,710,000[365]. - Provision for loan and lease losses increased significantly by 199.8% to $43,770,000 in Q3 2019 compared to $14,601,000 in Q3 2018, impacting net interest income after provision which fell by 45.4%[365]. - Net income for Q3 2019 was $7,383,000, down 68.0% from $23,100,000 in Q3 2018, with income available to common shareholders decreasing by 70.7%[365]. - The company achieved a 14% year-over-year increase in adjusted earnings per share, reflecting effective strategies in capturing economic shifts in Puerto Rico[369]. - Net income available to shareholders was $5.8 million, or $0.11 per share fully diluted, down from $19.6 million, or $0.43 per share fully diluted[97]. - Adjusted net income available to shareholders was $26.5 million, or $0.48 per share fully diluted, compared to $27.4 million, or $0.50 per share in the previous quarter[376]. Loan and Asset Management - Non-performing loans (NPL) were reduced by 40% year-over-year to 2% of originated loans, enhancing liquidity and operational flexibility[369]. - Total investments and loans decreased by 13.6% to $4,936,908,000 as of September 30, 2019, compared to $5,711,198,000 at the end of 2018[367]. - Loans increased by 1.2% to $4.41 billion, while average core deposits rose 3.4% to $4.56 billion[97]. - New loan origination amounted to $291.4 million, reflecting success in targeting small business customers and growing consumer banking[97]. - Total loans for the nine-month period were $4,519,393,000, up from $4,294,178,000, reflecting a growth of 5.25%[390]. - The non-acquired loan portfolio increased by $46.4 million to $3.791 billion at September 30, 2019, compared to December 31, 2018[436]. Capital and Liquidity - The company has approximately $1 billion in cash available to fund growth plans, including the acquisition of Scotiabank's operations in Puerto Rico and the U.S. Virgin Islands[369]. - The leverage capital ratio improved to 15.41% from 14.22% year-over-year, indicating a stronger capital position[367]. - Cash increased by 115.2% to $961.8 million as a result of selling $672.2 million of available-for-sale mortgage-backed securities during the nine-month period ended September 30, 2019[435]. - Stockholders' equity increased by 4.9% to $1.049 billion from $999.9 million at December 31, 2018[503]. - The common equity tier 1 capital ratio improved to 17.98% from 16.78% at the end of 2018[504]. Interest Income and Expenses - Interest income for the nine-month period ended September 30, 2019, was $282,620,000, an increase from $265,314,000 in 2018, reflecting a growth rate of 0.49%[390]. - The average interest rate on interest-earning assets rose to 6.24% in 2019 from 6.01% in 2018, marking an increase of 0.23 percentage points[390]. - The total interest expense for the quarter was $12,945,000, compared to $11,860,000 in the previous year, reflecting an increase of 9.11%[388]. - Interest income from originated loans increased by $29.0 million, reflecting higher balances in commercial, consumer, and auto loan portfolios[397]. - The average yield of total interest-earning assets increased by 23 basis points, while the average cost of interest-bearing liabilities rose by 19 basis points[396]. Non-Interest Income and Expenses - Non-interest income rose by 19.1% to $22,178,000 in Q3 2019, contributing to a total of $62,782,000 for the nine-month period, a 12.4% increase year-over-year[365]. - Total non-interest income for the quarter ended September 30, 2019, was $22.2 million, a 19.1% increase from $18.6 million in the same quarter of 2018[401]. - Total non-interest expense was $50.7 million, with a reduction of $1 million attributed to various credits and acquisition-related expenses[378]. - Non-interest expenses for the quarter ended September 30, 2019, were $50.7 million, a decrease of 0.4% compared to $50.9 million in the same quarter of 2018[407]. Risk Management and Credit Quality - The provision for loan and lease losses increased by $32 million, primarily due to the decision to sell $95 million in non-performing loans[384]. - Oriental's credit risk is heightened due to challenging economic conditions in Puerto Rico, including a shrinking population and a prolonged economic recession[540]. - The allowance coverage ratio for originated loan and lease losses to non-performing loans was 104.39% at September 30, 2019, compared to 77.38% at December 31, 2018[469]. - Non-performing assets decreased by 33.5% to $107.3 million, representing 1.93% of total assets, down from $161.3 million (2.76% of total assets) at December 31, 2018[469]. - Total net credit losses increased by 177.6% year-over-year to $34,427 thousand for the quarter ended September 30, 2019, compared to $12,402 thousand in 2018[489]. Market Performance - Market capitalization at the end of the period reached $1,124,501 thousand, a significant increase of 33.2% from $844,298 thousand[520]. - The market price per share at the end of the period was $21.90, reflecting a 33.0% increase from $16.46[520]. - Oriental is authorized to repurchase up to $7.7 million of its outstanding shares, with an estimated 353,007 shares available for purchase at the closing price[521].

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2019 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______________ to ______________ Commission File Number 001-12647 OFG Bancorp Incorporated in the Commonwealth of Puerto Rico, IRS Employer Identification No. ...

Financial Performance - Interest income increased by 13.9% to $94.71 million compared to $83.17 million in the same quarter last year [294]. - Net income available to common shareholders rose by 62.4% to $21.84 million from $13.45 million [297]. - Income before taxes increased by 40.6% to $35.04 million from $24.93 million [294]. - Net interest income for the quarter ended March 31, 2019, was $81.8 million, an increase of $7.8 million from $74.0 million in the same quarter of 2018 [302]. - Non-interest income for the quarter was $17.656 million, a decrease of 4.6% from $18.514 million in the previous year [306]. - Net income for the banking segment increased by $11.3 million from $17.1 million to $28.4 million for the quarter ended March 31, 2019 [325]. Loans and Deposits - Loans increased by 6.5% to $4.40 billion, while deposits grew by 1.3% to $4.90 billion [297]. - New loan origination reached $276.4 million, with a 41.4% increase in commercial loans targeting small business customers [297]. - Loan production for the first quarter of 2019 reached $276.4 million, a 10.7% decrease compared to $309.4 million in the same quarter of the previous year [335]. - The non-acquired loan portfolio decreased by $6.1 million to $3.739 billion at March 31, 2019 [335]. - The mortgage loan portfolio decreased by 2.6% to $651.4 million, representing 17.4% of the gross originated loan portfolio [346]. - The commercial loan portfolio decreased by 1.8% to $1.570 billion, accounting for 42.0% of the gross originated loan portfolio [346]. Asset Management - Total assets as of March 31, 2019, amounted to $6.603 billion, reflecting a 0.3% increase from $6.583 billion at December 31, 2018 [333]. - Investment securities available for sale increased by 47.23% to $1.239 billion, attributed to the reclassification of held-to-maturity securities [336]. - Total other assets increased by 8.8% to $949.1 million from $872.2 million at the end of 2018 [343]. - Cash and cash equivalents increased by 13.2% to $506.0 million, primarily due to higher core demand and savings deposits [334]. Equity and Capital Ratios - Total stockholders' equity increased by 2.13% to $1.021 billion from $999.9 million at December 31, 2018 [383]. - Common equity tier 1 capital ratio improved from 16.78% to 17.09% during the same period [384]. - The tangible common equity to tangible assets ratio increased to 13.05% as of March 31, 2019, compared to 12.76% at the end of 2018, marking a 2.3% improvement [389]. - The market capitalization at the end of the period reached $1,015,790 thousand, a significant increase of 20.3% from $844,298 thousand [388]. Risk Management - The company has implemented a comprehensive credit policy to manage credit risk, particularly in the challenging economic conditions of Puerto Rico [413]. - Oriental's credit risk is heightened by economic challenges in Puerto Rico, including a shrinking population and a prolonged recession [412]. - The Board of Directors oversees Oriental's risk management policies, which are continuously refined to enhance effectiveness [397]. - Oriental's liquidity risk management includes $431.0 million in repurchase agreements and $451.2 million in brokered deposits as of March 31, 2019 [418]. Operational Efficiency - Non-interest expenses slightly increased to $52.2 million, representing a 0.1% increase from $52.1 million in the previous year [311]. - The efficiency ratio improved from 56.51% in 2018 to 52.50% in 2019, indicating better operational efficiency [311]. - The company has developed specific internal controls and policies to manage operational risk, which includes risks from inadequate internal processes and external events [423]. Non-Performing Assets - Oriental's non-performing assets increased by 0.5% to $162.1 million, representing 2.50% of total assets, excluding acquired loans with deteriorated credit quality [361]. - The originated non-performing mortgage loans totaled $59.7 million, a 6.4% decrease from $63.7 million at December 31, 2018 [363]. - Oriental's originated non-performing commercial loans amounted to $50.4 million, an 18.7% increase from $42.5 million at December 31, 2018 [364]. Interest Rate Management - Oriental's interest rate risk management strategy includes the use of derivative instruments such as interest rate swaps to minimize fluctuations in earnings due to interest rate volatility [406]. - Oriental's net interest income simulation analysis indicates that a 200 basis points increase in interest rates could lead to a $11.451 million (3.63%) increase in net interest income under a static balance sheet scenario [405].