First Ban(US:FBP)2025-11-07 20:04Financial Performance - Net income for the quarter ended September 30, 2025, was $100.5 million ($0.63 per diluted common share), compared to $73.7 million ($0.45 per diluted common share) for the same period in 2024, representing a 36.3% increase [231]. - Net interest income for the quarter increased by $15.8 million to $217.9 million, with net interest margin rising by 32 basis points to 4.57% [235]. - Adjusted net income for the quarter ended September 30, 2025, was $81.6 million, compared to $73.7 million for the same period in 2024 [246]. - Net interest income for Q3 2025 was $217.9 million, an increase of $15.8 million compared to $202.1 million in Q3 2024 [257]. - For the nine-month period ended September 30, 2025, net interest income reached $646.2 million, up $48.0 million from $598.2 million in the same period of 2024 [261]. - Non-interest income decreased by $1.7 million to $30.8 million, primarily due to a decrease in realized gains from purchased income tax credits [235]. - Non-interest expenses for Q3 2025 amounted to $124.9 million, compared to $122.9 million for Q3 2024, with an efficiency ratio of 50.22% [272]. Loan and Asset Growth - Total loans surpassed $13 billion for the first time since 2010, increasing 5.6% on a linked-quarter annualized basis, driven by commercial and construction lending in Puerto Rico and Florida [222]. - Total loan production increased by $68.2 million to $1.4 billion for the quarter ended September 30, 2025, mainly in commercial and construction loans [236]. - The total loan portfolio before the ACL amounted to $13.1 billion as of September 30, 2025, reflecting an increase of $299.4 million compared to December 31, 2024, with $263.1 million attributed to commercial and construction loans [279]. - Total assets increased to approximately $19.3 billion, up $28.4 million from December 31, 2024, primarily due to an increase in total loans and the fair value of available-for-sale debt securities [236]. - The average balance of loans and leases was $12.88 billion for Q3 2025, compared to $12.35 billion in Q3 2024 [256]. Credit Quality and Losses - Net charge-offs for the quarter totaled $19.9 million, or an annualized 0.62% of average loans, down from $24.0 million (0.78%) in Q3 2024 [234]. - The provision for credit losses for the quarter was $17.6 million, compared to $15.2 million for the same period in 2024 [235]. - Non-performing assets rose to $119.4 million as of September 30, 2025, an increase of $1.1 million from December 31, 2024, primarily due to a $13.9 million increase in nonaccrual commercial and construction loans [236]. - The total provision for credit losses expense for the quarter ended September 30, 2025, was $18.27 million, compared to $16.47 million for the same quarter in 2024 [370]. - The ACL for commercial and construction loans increased by $9.3 million, primarily due to C&I loan growth and a deteriorating economic outlook for commercial real estate [364]. Capital and Liquidity - Capital deployment actions in Q3 2025 included $28.7 million in common stock dividends and $50.0 million in stock repurchases [224]. - A new stock repurchase program was approved, allowing for the repurchase of up to an additional $200 million of outstanding common stock [225]. - The Corporation had approximately $6.2 billion available to meet liquidity needs, representing 134% of estimated uninsured deposits as of September 30, 2025 [236]. - Total stockholders' equity increased to $1.9 billion, up $248.8 million from December 31, 2024, supported by net income generated in the first nine months of 2025 [236]. - The basic liquidity ratio was approximately 18.10% of total assets as of September 30, 2025, compared to 17.27% as of December 31, 2024 [304]. Economic Environment - Puerto Rico's real GNP grew by 2.1% in fiscal year 2024, with projections of 1.1% and 0.5% growth for fiscal years 2025 and 2026, respectively [404]. - Over 80% of Puerto Rico's outstanding debt has been restructured, saving more than $50 billion in debt payments [408]. - The Economic Activity Index (EDB-EAI) averaged 128.1 in 2024, a 0.6% increase year-over-year, but showed a decline to 127.1 in June 2025 [405]. - Non-farm payrolls in Puerto Rico increased by 1.5% in August 2025 compared to August 2024, with key industries like Construction and Leisure & Hospitality showing significant growth [406]. - The PROMESA oversight board has certified a revised fiscal plan for Puerto Rico, aiming to promote economic growth and long-term fiscal stability [407].