POPULAR, INC.
For the period ended Sep 30, 2025. Filed Nov 10, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2025 · Filed Nov 10, 2025
Extracted filing text, with the paragraph anchors used by the comparison.
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Item 6. Exhibits
Signatures
Forward-Looking Statements
This
Form 10-Q
contains “forward-looking
statements” within
the meaning
of the
U.S. Private
Securities Litigation
Reform Act
of
1995,
including,
without
limitation,
about
Inc.’s
(the
“Corporation,”
“Popular,”
“we,”
“us,”
“our”)
business,
financial condition, results
of operations, plans,
objectives and future
performance. These statements
are not
guarantees of future
performance,
are
based
on
current
expectations
and,
by
their
nature,
involve
risks,
uncertainties,
and
assumptions. Potential
factors, some
of which
are beyond
control, could
cause actual
results to
differ materially
from those expressed in, or implied by, such forward-looking statements. Risks and uncertainties include without limitation the effect
of competitive and
economic factors, and our
reaction to those factors,
the adequacy of
the allowance for loan
losses, delinquency
trends, market
risk and
the impact
of interest
rate changes
(including on
our cost
of deposits),
capital markets
conditions, capital
adequacy
and
liquidity,
and
the
effect
of
legal
and
regulatory
and
new
standards
on
the
financial condition
and results
of operations.
All statements
contained herein
that
are not
clearly
historical in
nature are
forward-
looking, and the words “anticipate,” “believe,” “continues,”
“expect,” “estimate,” “intend,” “project” and similar expressions
and future
or conditional verbs
such as
“will,” “would,” “should,”
“could,” “might,” “can,”
“may” or similar
expressions are
generally intended to
identify forward-looking statements.
Various factors, some of which
are beyond Popular’s control, could cause actual results to differ materially from those expressed in,
or implied by, such forward-looking statements. Factors that might cause such a
difference include, but are not limited to:
the
rate
of
growth
or
decline
in
the
economy
and
employment
levels,
as
well
as
general
and
conditions
in
the
geographic
areas
we
serve
and,
in
particular,
in
the
Commonwealth
of
Puerto
Rico
(the
“Commonwealth” or “Puerto Rico”), where a significant
portion of our business is concentrated;
adverse
economic conditions,
including high
levels
of
inflation, that
adversely affect
housing
prices, the
job
market,
consumer confidence
and spending
habits which
may affect
in turn,
among other
things, our
level of
assets, charge-offs and provision expense;
changes in interest rates and market liquidity,
which may reduce interest margins, impact funding sources, reduce loan
originations, affect
our ability
to originate
and distribute
financial products
in the
primary and
secondary markets
and
impact the value of our investment portfolio and
our ability to return capital to our stockholders;
the
impact
of
bank
failures
or
adverse
developments
at
other
banks
and
related
media
coverage
of
the
banking industry in general on investor and depositor
sentiment regarding the stability and liquidity of
banks;
the impact of the current fiscal and economic challenges of Puerto Rico and
the measures taken and to be taken by the
Puerto
Rico
and
the
Federally-appointed
oversight
board
on
the
economy,
our
customers
and
our
business;
the
public sector
deposits held
at
the Corporation,
whose future
balances are
uncertain and
difficult
to
predict
and
may
be
by
factors
such
as
the
amount
of
Federal
funds
received
by
the
P.R.
and
the
rate
of
expenditure
of
such
funds,
as
well
as
the
condition,
and
cash
management practices of the Puerto Rico Government
and its instrumentalities;
unforeseen or
catastrophic events,
including extreme
weather events
such as
hurricanes and
other natural
disasters,
man-made disasters, acts of violence or war or
pandemics, epidemics and other health-related
crises, or the fear of any
such event
occurring, any of
which could cause
adverse consequences for
our business, including,
but not
limited to,
disruptions in our operations;
our ability to
achieve the expected
benefits from our
transformation initiative, including
our ability to
achieve projected
earnings, efficiencies and
return on tangible
common equity and
accurately anticipate costs
and expenses associated
therewith;
the fiscal and monetary policies of the federal government
and its agencies;
federal
bank regulatory
and supervisory
policies, including
required levels
of
capital, liquidity,
resolution-
related requirements and the impact of other proposed
capital standards on our capital ratios;
the impact of the current or any future
U.S. government shutdown;
changes
in
and
uncertainty
federal
funding,
tax,
trade
and
tariff
policies,
and
rulemaking,
supervision,
examination and enforcement priorities of the federal
administration;
to
or
Federal
Deposit
Insurance
(“FDIC”)
assessments,
such
as
the
special
assessment implemented
by the
FDIC to
recover the
losses to
the deposit
insurance fund
(“DIF”) resulting
receiverships of Silicon Valley Bank and Signature Bank;
regulatory approvals
that may
be necessary
to undertake
certain actions
or consummate
strategic transactions,
such
as acquisitions and dispositions;
the
relative strength
or
weakness
of
the
consumer and
commercial credit
sectors
and
of
the
real
estate markets
in
Puerto Rico and the other markets in which
our borrowers are located;
a deterioration in the credit quality of our
clients, customers and counterparties;
the performance of the stock and bond markets;
competition in the financial services industry;
possible legislative, tax or regulatory changes;
a failure
in or
breach of
our operational
or security
systems or
infrastructure or
those of
Evertec, Inc.,
our provider
of
core financial
transaction processing and
information technology services,
or of
third parties
providing services
to us,
as
a
result
of
cyberattacks,
e-fraud,
denial-of-services
and
computer
intrusion,
resulting
in,
among
other
things, loss or breach of customer data, disruption
of services, reputational damage or additional
costs to Popular;
changes in market rates and prices which may
adversely impact the value of financial assets
and liabilities;
potential judgments,
claims, damages,
penalties, fines,
enforcement actions
and
reputational damage
resulting from
pending or future litigation and regulatory or government
investigations or actions;
changes in accounting standards, rules and interpretations;
our ability to grow our core businesses;
decisions to downsize, sell or close branches or business
units or otherwise change our business mix;
and
management’s ability to identify and manage these and
other risks.
Moreover, the
outcome of any
legal and
regulatory proceedings, as
discussed in “Part
II, Item
- Legal Proceedings,”
is inherently
uncertain and depends on judicial interpretations of law and the findings of regulators, judges and/or juries. Investors should refer to
the Corporation’s Annual
Report on Form
10-K for the
year ended December 31,
2024 (the “2024
Form 10-K”), as
well as “Part
II,
Item 1A” of our Quarterly
Report on this Form 10-Q for
a discussion of such factors and
certain risks and uncertainties to which the
Corporation is subject.
All forward-looking
statements included
in this
Form 10-Q
are based
upon information
available to
Popular as
of the
date of
this
Form 10-Q, and other than as
required by law, including the
requirements of applicable securities laws, we assume no
obligation to
update or revise any such forward-looking statements to reflect occurrences or unanticipated events or circumstances after the date
of such statements.
OF FINANCIAL CONDITION
[UNAUDITED]
(In thousands, except share information)
Assets:
$
377,079
$
419,638
Money market investments:
Time deposits with other banks
Total money market investments
Trading account debt securities, at fair value
33,122
32,831
Debt securities available-for-sale, at fair
value:
Pledged securities with creditors’ right to repledge
40,352
30,486
Other debt securities available-for-sale
20,646,071
18,215,417
Debt securities held-to-maturity, at amortized cost:
Pledged securities with creditors’ right to repledge
18,525
27,405
Other debt securities held-to-maturity
7,414,610
7,730,672
Debt securities held-to-maturity (fair
value 2025 - $
; 2024 - $
)
7,433,135
7,758,077
Less – Allowance for credit losses
5,837
5,317
Debt securities held-to-maturity, net
Equity securities (realizable value 2025 -
$
219,599
; 2024 - $
208,663
)
218,993
208,166
Loans held-for-sale, at fair value
7,783
5,423
39,111,956
37,522,995
Less – Unearned income
424,798
415,343
786,220
746,024
Total loans held-in-portfolio, net
37,900,938
36,361,628
Premises and equipment, net
679,651
601,787
Other real estate
42,950
57,268
Accrued income receivable
297,347
263,389
Mortgage servicing rights, at fair value
99,523
108,103
1,744,886
1,797,759
789,954
802,954
Other intangible assets
5,460
6,826
$
$
Liabilities and Stockholders’ Equity
Liabilities:
$
$
51,639,378
49,744,790
56,853
54,833
400,000
225,000
789,954
896,293
1,189,915
1,371,846
Total liabilities
68,950,126
67,432,317
Commitments and contingencies (Refer
to Note 18)
Stockholders’ equity:
Preferred stock,
30,000,000
shares authorized;
885,726
shares issued and outstanding (2024 -
885,726
)
22,143
22,143
Common stock, $
0.01
par value;
170,000,000
shares authorized;
104,906,144
shares issued (2024 -
104,849,460
) and
shares outstanding (2024 -
70,141,291
)
1,049
1,048
Surplus
4,908,693
Retained earnings
4,570,957
Treasury stock - at cost,
37,946,278
shares (2024 -
34,708,169
)
(2,228,535)
Accumulated other comprehensive loss, net
of tax
(1,661,240)
Total stockholders’ equity
Total liabilities and stockholders’ equity
$
$
The accompanying notes are an integral part of
these Consolidated Financial Statements.
OF OPERATIONS
Interest income:
Loans
$
702,039
$
664,731
$
2,053,299
$
1,952,200
66,867
96,061
206,565
272,893
197,743
176,656
567,655
528,403
Total interest income
966,649
937,448
2,827,519
2,753,496
Interest expense:
303,432
350,985
896,353
Short-term borrowings
4,616
1,430
11,342
3,748
Long-term debt
12,096
12,560
36,173
37,799
Total interest expense
320,144
364,975
943,868
646,505
572,473
75,125
71,448
188,147
190,840
Net interest income after provision for credit losses
571,380
501,025
1,695,504
1,500,689
Non-interest income:
39,077
38,315
116,957
113,283
Other service fees
101,376
98,748
296,406
289,883
2,771
2,670
11,332
12,753
Net gain (loss), including impairment on equity securities
2,197
(546)
3,645
Net gain on trading account debt securities
1,456
1,455
Adjustments to indemnity reserves on loans sold
Other operating income
25,340
23,270
61,608
75,173
Total non-interest income
171,195
164,082
491,733
494,206
Operating expenses:
232,988
201,856
675,056
614,657
Net occupancy expenses
26,083
28,031
82,441
83,764
Equipment expenses
5,313
9,349
16,404
28,578
Other taxes
17,967
17,757
55,324
47,465
25,808
26,708
80,741
93,370
Technology and software expenses
87,117
88,452
255,481
247,666
38,408
34,320
114,050
107,610
Communications
4,836
5,229
14,750
14,143
Business promotion
27,304
25,637
77,364
72,075
Deposit insurance
10,873
10,433
30,315
44,901
Other real estate owned (OREO) income
(3,408)
(2,674)
(10,862)
(13,745)
8,614
21,519
53,630
77,293
1,366
2,233
Goodwill impairment
13,000
13,000
Total operating expenses
495,287
467,321
247,288
197,786
728,177
574,885
35,971
42,463
128,918
138,490
Net Income
$
211,317
$
155,323
$
599,259
$
436,395
Net Income Applicable to Common Stock
$
210,964
$
154,970
$
598,200
$
435,336
Net Income per Common Share – Basic
$
3.15
$
2.16
$
8.78
$
6.06
Net Income per Common Share – Diluted
$
3.14
$
2.16
$
8.78
$
6.05
The accompanying notes are an integral part of
these Consolidated Financial Statements.
OF COMPREHENSIVE INCOME
Quarters ended,
Nine months ended,
$
211,317
$
155,323
$
599,259
$
436,395
Other comprehensive income (loss) before
tax:
Foreign currency translation adjustment
(3,240)
Amortization of net losses of pension and
2,272
3,618
6,817
10,854
Unrealized holding gains (losses) on debt securities
arising during the period
110,430
380,927
335,388
330,319
Amortization of unrealized losses of debt
securities transfer from available-for-
47,191
45,331
138,743
133,761
Other comprehensive income before tax
145,369
430,491
467,278
471,694
(25,972)
(65,203)
(82,298)
(89,157)
Total other comprehensive income, net of tax
119,397
365,288
384,980
382,537
Comprehensive income, net of tax
$
330,714
$
520,611
$
984,239
$
818,932
Tax effect allocated to each component of other comprehensive
income:
Nine months ended,
Amortization of net losses of pension and
$(
)
$(
1,357
)
$(
2,555
)
$(
4,070
)
Unrealized holding losses on debt securities
arising during the period
(15,683)
(54,779)
(51,994)
(58,334)
Amortization of unrealized losses of debt
securities transfer from available-for-
(9,438)
(9,067)
(27,749)
(26,753)
$
(25,972)
$
(65,203)
$
(82,298)
$
(89,157)
The accompanying notes are an integral
part of the Consolidated Financial Statements.
OF CHANGES IN STOCKHOLDERS’ EQUITY
other
Common
Preferred
Retained
comprehensive
stock
stock
Surplus
earnings
stock
loss
Total
Balance at June 30, 2024
$
1,048
$
22,143
$
4,852,747
$
4,385,522
$
(2,010,500)
$
(1,878,282)
$
5,372,678
155,323
155,323
1,704
1,704
[1]
(44,614)
(44,614)
(353)
(353)
[2]
(59,147)
(59,147)
(582)
(365)
365,288
365,288
$
1,048
$
22,143
$
4,853,869
$
4,495,878
$
(2,069,430)
$
$
5,790,514
Balance at June 30, 2025
$
1,049
$
22,143
$
4,919,950
$
4,861,958
$
(2,455,425)
$
(1,395,657)
$
5,954,018
211,317
211,317
1,764
1,764
[1]
(50,376)
(50,376)
(353)
(353)
[3]
(119,697)
(119,697)
(947)
(398)
119,397
119,397
$
1,049
$
22,143
$
$
$
$
$
[1]
Dividends declared per common share during the quarter
ended September 30, 2025 - $
0.75
0.62
).
[2]
Includes common
stock
repurchases of
$
58.8
million
as part
of the
2024 common
stock repurchase
program. Refer
to Note
15 for
information.
[3]
Includes common stock
repurchases of $
119.4
million as part
of the 2024
and 2025 common
stock repurchase programs
previously announced
by the Corporation. Refer to Note 15 for additional information.
OF CHANGES IN STOCKHOLDERS’ EQUITY
other
Common
Preferred
Retained
comprehensive
stock
stock
Surplus
earnings
stock
loss
Total
Balance at December 31, 2023
$
1,048
$
22,143
$
4,843,399
$
4,194,851
$
(2,018,957)
$
(1,895,531)
$
5,146,953
436,395
436,395
5,271
5,271
[1]
(134,309)
(134,309)
(1,059)
(1,059)
[2]
(65,923)
(65,923)
5,199
15,450
20,649
382,537
382,537
$
1,048
$
22,143
$
4,853,869
$
4,495,878
$
(2,069,430)
$
$
5,790,514
Balance at December 31, 2024
$
1,048
$
22,143
$
4,908,693
$
4,570,957
$
(2,228,535)
$
(1,661,240)
$
599,259
599,259
5,293
5,294
[1]
(146,611)
(146,611)
(1,059)
(1,059)
[3]
(362,752)
(362,752)
6,781
16,714
23,495
384,980
384,980
$
1,049
$
22,143
$
$
$
$
$
[1]
Dividends declared per common share during the nine months
ended September 30, 2025 - $
2.15
1.86
).
[2]
Includes common stock repurchases of $
58.8
million as part of the 2024 common stock repurchase
program. Refer to Note 15 for additional
information.
[3]
Includes common stock repurchases of $
353.7
million as part of the 2024 and 2025 common stock
repurchase programs previously announced
by the Corporation. Refer to Note 15 for additional information.
For the nine months ended
Disclosure of changes in number of shares:
Preferred Stock:
Balance at beginning and end of period
885,726
885,726
Common Stock – Issued:
104,849,460
104,767,348
56,684
65,364
Balance at end of period
104,906,144
104,832,712
Treasury stock
(37,946,278)
(33,045,363)
Common Stock – Outstanding
71,787,349
The accompanying notes are an integral part of these Consolidated
OF CASH FLOWS
Cash flows from operating activities:
$
599,259
$
436,395
Adjustments to reconcile net income to net cash provided
by operating activities:
188,147
190,840
13,000
1,366
2,233
Depreciation and amortization of premises and equipment
38,901
46,720
Net accretion of discounts and amortization of premiums and
deferred fees
(203,871)
(196,221)
Interest capitalized on loans subject to the temporary payment
moratorium or loss mitigation alternatives
(4,729)
(5,933)
Share-based compensation
23,574
17,853
Fair value adjustments on mortgage servicing rights
9,359
10,280
Adjustments to indemnity reserves on loans sold
(329)
(783)
Earnings from investments under the equity method, net
of dividends or distributions
(13,760)
(12,723)
Deferred income tax expense
26,666
19,247
Gain on:
Disposition of premises and equipment and other productive
assets
(31)
(7,651)
Sale of loans, including valuation adjustments on loans
held-for-sale and mortgage banking activities
(103)
(396)
Sale of equity method investment
(1,226)
Sale of foreclosed assets, including write-downs
(8,722)
(13,590)
Acquisitions of loans held-for-sale
(4,135)
(5,810)
Proceeds from sale of loans held-for-sale
26,924
28,697
Net originations on loans held-for-sale
(22,184)
(31,284)
Net decrease (increase) in:
Trading debt securities
6,561
10,445
(4,827)
(7,337)
Accrued income receivable
(33,921)
6,032
(4,008)
15,425
Net increase (decrease) in:
Interest payable
(7,042)
(4,785)
Pension and other postretirement benefits obligation
3,372
5,937
(18,266)
(28,352)
Total adjustments
10,716
38,844
Net cash provided by operating activities
609,975
475,239
Cash flows from investing activities:
Net decrease in money market investments
1,626,969
469,042
Purchases of investment securities:
Available-for-sale
(28,253,550)
(24,469,345)
Equity
(37,006)
(2,370)
Proceeds from calls, paydowns, maturities and redemptions
of investment securities:
Available-for-sale
26,178,815
24,670,995
Held-to-maturity
456,532
508,511
Proceeds from sale of investment securities:
Equity
32,506
5,242
Net disbursements
on loans
(1,342,325)
(833,899)
Proceeds from sale of loans
61,379
18,266
Acquisition of loan portfolios
(480,793)
(510,556)
Return of capital from equity method investments
Payments to acquire equity method investments
(687)
(1,250)
Net proceeds from sale of equity method investment
1,226
Acquisition of premises and equipment and other productive
assets
(150,079)
(153,085)
Proceeds from sale of:
Premises and equipment and other productive assets
5,570
Foreclosed assets
67,911
82,986
Net cash used in investing activities
(1,838,606)
(209,614)
Cash flows from financing activities:
Net increase in:
1,626,359
46,924
2,020
(36,024)
175,000
Payments of notes payable
(113,522)
(69,570)
Principal payments of finance leases
(2,894)
(2,717)
Proceeds from issuances of notes payable
6,112
Proceeds from issuances of common stock
5,294
5,271
Dividends paid
(146,840)
(135,495)
Net payments for repurchase of common stock
(356,975)
(59,556)
Payments related to tax withholding for share-based compensation
(8,070)
(6,367)
Net cash provided by financing activities
1,186,484
(257,534)
Net (decrease) increase in cash and due from banks, and
restricted cash
(42,147)
8,091
Cash and due from banks, and restricted cash at beginning
of period
429,406
427,575
Cash and due from banks, and restricted cash at the end of
the period
$
387,259
$
435,666
The accompanying notes are an integral part of these Consolidated
Notes to Consolidated Financial
(Unaudited)
Note 1 -
Nature of operations
Note 2 -
Basis of presentation
Note 3 -
New accounting pronouncements
Note 4 -
Restrictions on cash and due from banks and
certain securities
Note 5 -
Note 6 -
Debt securities held-to-maturity
Note 7 -
Loans
Note 8 -
Allowance for credit losses – loans held-in-
Note 9 -
Note 10 -
Note 11 -
Goodwill and other intangible assets
Note 12 -
Note 13 -
Note 14 -
Note 15 -
Note 16 -
Other comprehensive income (loss)
Note 17 -
Guarantees
Note 18 -
Commitments and contingencies
Note 19-
Non-consolidated variable interest entities
Note 20 -
Related party transactions
Note 21 -
Fair value measurement
Note 22 -
Fair value of financial instruments
Note 23 -
Net income per common share
Note 24 -
Revenue from contracts with customers
Note 25 -
Stock-based compensation
Note 26 -
Income taxes
Note 27 -
Supplemental disclosure on the consolidated
statements of cash flows
Note 28 -
Segment reporting
Note 1 – Nature of Operations
Inc. (the
“Corporation” or
“Popular”) is
a diversified,
publicly owned
financial holding
company subject
to the
supervision
and
regulation
of
the
Board
of
Governors
of
the
Federal
Reserve
System.
The
has
in
Puerto
Rico,
the
mainland United
States (“U.S.”)
and the
U.S. and
British Virgin
Islands. In
provides retail,
and commercial
banking services,
and auto
financing through
its principal
banking subsidiary,
Banco
Popular
de
Puerto
Rico
(“BPPR”), as
well
as
broker-dealer and
services through
specialized subsidiaries.
In
the
U.S.
mainland, the Corporation provides retail and commercial
banking services, as well as equipment
leasing and financing, through its
New
York-chartered
banking
Popular
Bank
(“PB”
or
“Popular U.S.”),
which
has
branches
located
in
New
York,
New
Jersey, and Florida.
Note 2 – Basis of Presentation
Basis of Presentation
The (unaudited) interim Consolidated Financial Statements are, in the opinion of management, a fair statement of the results
for the
periods reported.
The consolidated statement
of financial condition
presented as
of December 31,
2024 was
derived from
audited
Consolidated Financial Statements of the Corporation
for the year ended December 31, 2024.
Certain
and
notes
to
the
which
would
normally
be
in
prepared in
accordance with
Accounting Principles
Generally Accepted
in the
of America
(U.S. GAAP),
have been
condensed or omitted from the unaudited financial statements pursuant
to the rules and regulations of the
Securities and Exchange
Commission.
Accordingly,
these
should
be
read
in
conjunction
with
the
audited
Statements of
for the
year ended
2024,
the 2024
Form 10-K.
Operating results
for the
interim periods disclosed herein are not necessarily
indicative of the results that may be expected
for a full year or any future period.
Use of Estimates in the Preparation of Financial Statements
The preparation of financial
statements in conformity with
accounting principles generally accepted in
the United States
of America
requires management to make
estimates and assumptions that
affect the reported
amounts of assets and
liabilities and contingent
assets
and
liabilities
at
the
date
of
the
statements,
and
the
reported
amounts
of
revenues
and
during
the
reporting period. Actual results could differ from those estimates.
Note 3 - New accounting pronouncements
Recently Adopted Accounting Standards Updates
FASB ASU 2025-02,
Liabilities (Topic 405) -
Amendments to SEC
Paragraphs Pursuant to
SEC Staff Accounting
Bulletin No. 122
The
Financial Accounting
Standards Board
("FASB")
issued
Accounting
Update
("ASU")
2025-02
in
March
2025,
which
amends
the
in
Accounting
Standards
("ASC")
450-10-
S99-1
by
removing
the
interpretative
of
Section
FF
of
Topic
in
the
Staff Accounting Bulletin Series ("SAB") text
that
addressed
the
for
obligations to
safeguard crypto-assets
held
by platform
users to
align the
ASC with
the
latest
SAB
directive,
ensuring
consistency and clarity.
March 18, 2025
The
was
not
by
the
adoption of
this
ASU
since
it does
not currently hold crypto-assets.
FASB ASU 2024-02,
Codification Improvements
- Amendments to Remove
References to the
Concepts Statements
The
FASB
issued
ASU
2024-02
in
March
2024, which
removes various
references to
concept statements from the ASC. The ASU
intends
to
simplify
the
and
distinguish
between
nonauthoritative
and
authoritative guidance.
The
was
not
by
the adoption of this ASU since it did not
provide for
accounting changes
or new
or
requirements.
The
ASU
eliminated
references
within
the
ASC
to
the
concept
statements,
which
is
considered non-authoritative guidance.
FASB ASU 2024-01,
Compensation - Stock
Compensation (Topic 718)
- Scope Application of
Profits Interest and Similar
Awards
The
FASB
issued
ASU
2024-01
in
March
2024,
which
amends
ASC
Topic
by
an
illustrative
example
to
demonstrate how
an entity
would apply
the
scope
in
paragraph
718-10-15-3
to determine whether profits interest awards
should be accounted
for in accordance
with
ASC
Topic
The
ASU
is
intended
to
reduce complexity and diversity in practice.
The
was
not
by
the
of
this
ASU
since
the
share
awards
of
the
continue
to
meet
the
requirements of ASC 718-10-15-3.
FASB ASU 2023-08,
Intangibles - Goodwill and
Other - Crypto Assets
(Subtopic 350-60) -
Accounting for and
Disclosure of Crypto
Assets
The
FASB
issued
ASU
2023-08
in
2023,
which
amends
ASC
Subtopic
350-60
by
that
crypto
assets
are
measured
at
fair
value
in
the
statement
of
each
period
with
changes
from
remeasurement
being
in
net
income.
The
ASU
also
requires
enhanced
for
both
annual
and
interim
periods
to
provide
investors
with
relevant information
to
analyze and
assess
the
and
risk
of
individual crypto asset holdings.
The
was
not
by
the
adoption of
this
ASU
since
it does
not currently hold crypto-assets.
Recently Adopted Accounting Standards Updates
FASB ASU 2023-05,
Business Combinations -
Joint Venture Formations
(Subtopic 805-60) -
Recognition and initial
measurement
The
FASB
issued
ASU
2023-05
in
August
2023, which
amends ASC
Subtopic 805-60
to include specific
guidance about how
joint
ventures
should
recognize
and
initially
measure
assets
contributed
and
liabilities
assumed.
The
amendments
require
that
a
joint venture, upon formation, recognize and
initially
measure its
liabilities at
fair value.
The
was
not
at
the time of adoption of this ASU since it
elected
to
prospectively
apply
the
standard. The Corporation will
this
for
the
initial
measurement of assets and liabilities of
joint
ventures created
after the
date of
adoption.
FASB ASU 2025-07,
Derivatives and Hedging
(Topic 815) and Revenue
from Contracts with
Customers (Topic 606) -
Derivatives Scope
Refinements and Scope
Clarification for Share-
Based Noncash
Consideration from a
Customer in a Revenue
Contract
The
FASB
issued
ASU
2025-07
in
September 2025, which refines the scope of
derivative accounting under
ASC Topic
and
the
treatment
of
noncash
under
ASC
Topic
The
update
excludes
certain
non-
exchange traded
contracts with
underlyings
based
on
the
of
one
of
the
parties from derivative accounting, aiming to
better
reflect
the
nature
of
these
arrangements
and
reduce
complexity.
It
also
confirms
that
noncash
from
a
customer
should
be
for
under
ASC
Topic
until
the right
to receive
or retain
such non-cash
becomes
unconditional,
promoting
consistency
in
revenue
recognition practices.
any
impact
that
the
of
this
will
have
on
its
and
and
FASB ASU 2025-06,
Intangibles - Goodwill and
Other - Internal-Use
Software (Subtopic 350-
- Targeted
Improvements to the
Accounting for Internal-
Use Software
The
FASB
issued
ASU
2025-06
in
September 2025, which seeks to modernize
the
for
internal-use
under
ASC
Subtopic
350-40,
Intangibles—
Goodwill and Other—Internal-Use Software.
The
update
replaces
the
traditional
stage-
based
model
(preliminary,
development,
post-implementation)
with
a
principles-
based framework that better
reflects current
practices,
agile and cloud-based approaches.
January 1, 2028
the
impact
that
the
of
this
will
have
on
our
for
internal
use
considering
our
practices
which
may
include
agile
and
cloud
based
approaches. Given the
recent issuance
of
this
it
is
too
early
to
tell
whether
the
impact
will
be
material
in
our
and
presentation and disclosures.
FASB ASU 2025-05,
Financial Instruments -
Credit Losses (Topic 326)
- Measurement of Credit
Losses for Accounts
Receivables and Contract
Assets
The
FASB
issued
ASU
2025-05
in
July
2025,
which
permits
to
elect
a
practical
expedient
when
for
current
accounts
receivable
and
current
contract
assets
arising
from
for
under
ASC
Topic
606,
Revenue
from
Contracts
with
Customers.
This practical
expedient establishes
that, in
developing
reasonable
and
supportable
forecasts
as
part
of
estimating
credit
losses,
assume
that
current
conditions as
of the
balance sheet
date do
not
change
for
the
remaining
life
of
the
asset.
The
does
not
expect
that
the adoption of this standard will have a
impact
on
its
statements.
FASB ASU 2025-04,
Compensation - Stock
Compensation (Topic 718)
and Revenue from
Contracts with Customers
(Topic 606) - Clarifications
to Share-Based
Consideration Payable to
a Customer
The
FASB
issued
ASU
2025-04
in
May
2025,
which
the
for
awards
granted
as
payable
to
a
customer.
The
ASU expands
the definition
of performance
condition
for
under ASC 718 and eliminates the forfeiture
policy election for
service conditions. It
also
confirms
that
the
constraint
in
ASC
does
not
apply
to
such awards.
expect to
be
by
the
of
this
ASU
since
it
does
not
grant
payment awards to customers.
FASB ASU 2025-03,
Business Combinations
(Topic 805) and
Consolidation (Topic 810)
- Determining the
Accounting Acquirer in the
Acquisition of a Variable
Interest Entity
The
FASB
issued
ASU
2025-03
in
May
2025 which
requires that
an entity
the
factors
in
paragraphs
805-10-55-12
through
55-15
when
it
is
involved
in
an
acquisition transaction
effected primarily
by
exchanging
equity
interests when
the
legal
acquiree is
a variable
interest entity
("VIE")
that
meets
the
definition
of
a
to
determine
which
entity
is
the
acquirer.
This
replaces
the
requirement
that
the
primary
beneficiary
always is the acquirer.
any
impact
that
the
of
this
will
have
on
its
and
and
FASB ASU 2024-04, Debt
- Debt with Conversion
and Other Options
(Subtopic 470- 20) -
Induced Conversions of
Convertible Debt
Instruments
The
FASB
issued
ASU
2024-04
in
November
2024,
which
the
for
determining
whether
certain
settlements
of
convertible
debt
instruments should
be accounted
for as
an
induced
conversion.
Also
it
makes
clarifications
to
assist
stakeholders in
applying the
guidance. The
ASU
that
the
incorporation,
elimination,
or
modification
of
a
volume-
average
price
("VWAP")
formula
does
not
automatically
cause
a
settlement
to
be
for
as
an
extinguishment
and
that
the
induced
conversion
applies to a convertible
debt instrument that
is not currently
convertible as long as
it had
a substantive
conversion feature
as of
both
its
issuance
date
and
the
date
the
inducement offer is accepted.
any
impact
that
the
of
this
will
have
on
its
and
and
FASB ASU 2024-03,
Income Statement -
Reporting Comprehensive
Income - Expense
Disaggregation
Disclosures (Subtopic
220-40) - Disaggregation
of Income Statement
Expenses (As updated by
ASU 2025-01)
The
FASB
issued
ASU
2024-03
in
November
2024,
which
requires
public
to
disclose
about
specific
expense
categories
in
the
notes to
financial statements
at interim
and
annual
periods
to
improve
financial transparency.
For fiscal years
beginning on
For interim periods
within fiscal years
beginning after
January 1, 2028
the
impact
that
the
of
this
will
have
on
its
and
and
FASB ASU 2023-09,
Income Tax (Topic
Improvements to Income
Tax Disclosures
The
FASB
issued
ASU
2023-09
in
December 2023,
which amends
ASC Topic
by
enhancing
rate
reconciliation
and
the
disclosure of
income taxes paid, income (or
loss)
before
income
tax
expense
and
income
tax
expense
disaggregated
by
national, state and foreign level. Disclosures
that
no
longer
were
cost
beneficial
or
relevant
were
removed
from
ASC Topic 740.
The
will
prospectively
adopt
ASU
2023-09
for
it's
in
the
Form
10-K.
The
of
this standard
will result
in the
inclusion
of
certain
new
categories
in
the
effective
income
tax
rate
and
income
tax expense tabular disclosures, as well
as the
disclosure of income
taxes paid,
within the income taxes note.
FASB ASU 2023-06,
Disclosure Improvements -
Codification Amendments
in Response to the SEC’s
Disclosure Update and
Simplification Initiative
The FASB
issued ASU
2023-06 in
October
which
modifies
the
or
of
various
subtopics
in
the
with
the
purpose
of
aligning
U.S.
GAAP
with
those
of
the
SEC
under
Regulation S-X and S-K.
The date on which
the SEC removes
related disclosure
requirements. If by
June 30, 2027 the
SEC has not
removed the
requirements, the
standard will not
become
effective.
expect to
be
by
the
of
this
ASU
since
it
is
subject
to
SEC's
current
and
requirements under Regulation S-X and
S-K.
Note 4 - Restrictions on cash and due
from banks and certain securities
BPPR is
required by
regulatory agencies
to maintain
average reserve
balances with
the Federal
Reserve Bank
of New
York
(the
“Fed”) or other banks. Required average reserve balances in BPPR amounted to $
2.6
billion at September 30, 2025 (December 31,
2024 -
$
2.6
billion). Cash
and due
from banks,
as well
as other
highly liquid
securities, are
used to
cover these
required average
reserve balances.
At
30,
2025,
the
held
$
million
in
assets
in
the
form
of
funds
deposited
in
money
market
accounts, debt
securities available for
sale and
equity securities (December
- $
The restricted
assets held
in
debt securities available for
sale and equity securities
consist primarily of assets
held for the Corporation’s
non-qualified retirement
plans and fund deposits guaranteeing possible liens
or encumbrances over the title of insured properties.
Note 5 – Debt securities available-for-sale
The
tables
present
the
amortized
cost,
gross
gains
and
losses,
fair
value,
average
yield
and
contractual maturities of debt securities available-for-sale
at September 30, 2025 and December 31,
Gross
Gross
Fair
average
cost
gains
losses
value
yield
$
10,182,136
$
2,162
$
8,399
$
10,175,899
3.68
%
5,531,033
23,619
23,786
5,530,866
3.73
15,713,169
25,781
32,185
15,706,765
3.70
6,213
6,078
1.52
12,050
11,501
2.51
93,542
6,540
87,121
2.92
mortgage obligations - federal agencies
111,805
7,224
104,700
2.80
15,380
15,302
2.23
82,670
2,102
80,576
2.30
836,304
48,922
787,629
2.10
4,859,779
869,985
3,990,701
1.70
securities - federal agencies
5,794,133
1,162
921,087
4,874,208
1.77
Other
4.33
4.79
Total other
4.48
[1]
$
21,619,857
$
27,062
$
960,496
$
3.18
%
[1]
14.9
billion pledged to secure government and trust
deposits, credit facilities and loan servicing agreements that the
secured parties
are not permitted to sell or repledge the collateral, of which
$
13.9
billion serve as collateral for public funds.
The Corporation had unpledged
Available for Sale securities with a fair value of
$
5.7
billion that could be used to increase its borrowing
facilities.
Gross
Gross
Fair
average
cost
gains
losses
value
yield
$
10,555,397
$
1,282
$
46,275
$
10,510,404
3.33
%
2,547,936
63,381
2,484,706
3.07
13,103,333
1,433
109,656
12,995,110
3.28
10,538
10,193
1.53
15,334
14,430
2.24
104,168
8,639
95,661
2.76
mortgage obligations - federal agencies
130,040
9,888
120,284
2.60
1.65
79,542
2,700
76,850
2.35
733,506
45,078
688,510
2.37
5,468,448
1,106,657
4,362,128
1.67
securities - federal agencies
6,282,272
1,154,440
5,128,259
1.75
Other
5.00
1,750
1,750
5.50
Total other
2,250
2,250
5.39
[1]
$
19,517,895
$
1,992
$
1,273,984
$
2.78
%
[1]
13.9
billion pledged to secure government and trust deposits,
assets sold under agreements to repurchase, credit facilities
and loan
servicing agreements that the secured parties are not permitted
to sell or repledge the collateral, of which $
12.9
billion serve as collateral for
public funds. The Corporation had unpledged Available
for Sale securities with a fair value of
$
4.3
billion that could be used to increase its
borrowing facilities.
The weighted
average yield
on debt
securities available-for-sale
is based
on amortized
cost; therefore,
it
give
effect to
changes in fair value.
Securities
not
due
on
a
single
maturity
date,
such
as
and
obligations,
are
based
on
the
period
of
final
maturity.
The
of
obligations, mortgage-backed securities
and certain
other securities
may differ
from their
contractual maturities
because they
may
be subject to prepayments or may be called
by the issuer.
did not
intend to
sell and
did not
believe that
it was
more likely
than not
that it
would be
required to sell debt securities classified as
available-for-sale. There were
no
sales of debt securities classified as available-for-sale
during the nine months ended September 30, 2025
and 2024.
The
tables
present
the
fair
value
and
gross
losses
of
debt
available-for-sale,
aggregated by investment category and length of
time that individual securities have been in a continuous
unrealized loss position at
Less than 12 months
12 months or more
Total
Gross
Gross
Gross
Fair
Fair
Fair
value
losses
value
losses
value
losses
$
4,241,874
$
9,041
$
1,656,231
$
23,144
$
5,898,105
$
32,185
6,506
87,499
7,215
94,005
7,224
Mortgage-backed securities -federal agencies
18,000
4,798,315
920,607
4,816,315
921,087
available-for-sale in an unrealized loss position
$
4,266,380
$
9,530
$
6,542,045
$
950,966
$
10,808,425
$
960,496
Less than 12 months
12 months or more
Total
Gross
Gross
Gross
Fair
Fair
Fair
value
losses
value
losses
value
losses
$
2,309,894
$
24,646
$
3,638,092
$
85,010
$
5,947,986
$
109,656
4,878
102,160
9,861
107,038
9,888
70,777
3,175
5,031,414
1,151,265
5,102,191
1,154,440
available-for-sale in an unrealized loss position
$
2,385,549
$
27,848
$
8,771,666
$
1,246,136
$
11,157,215
$
1,273,984
As
of
30,
2025,
the
of
debt
reflects
gross
losses
of
$
1.0
billion
(December 31, 2024
- $
1.3
billion), driven mainly
by mortgage-backed securities, impacted
by the higher-interest
rate environment
and
the
portfolio’s
longer
duration.
The
of
available-for-sale debt
is
comprised
mainly
of
U.S
Treasuries
and
from
the
U.S.
its
or
sponsored
entities,
Federal
National
Association
(“FNMA”),
Federal
Home
Loan
(“FHLMC”)
and
National
Association
(“GNMA”).
These
carry
an
explicit
or
implicit
from
the
U.S.
are
highly
rated
by
major
rating
agencies, and have a long history of no credit
losses. Accordingly, the Corporation applies a zero-credit loss assumption.
Note 6 –Debt securities held-to-maturity
tables present
the amortized
cost, allowance
losses, gross
unrealized gains
and losses,
approximate fair
value, weighted
average yield
and contractual maturities
of debt
securities held-to-maturity
at September 30,
Value
Gross
Gross
Book
[1]
for Credit
Net of
Fair
average
cost
Value
Losses
gains
losses
value
yield
$
2,107,187
$
2,071,286
$
$
2,071,286
$
2,554
$
$
2,073,078
1.50
%
5,607,069
5,302,786
5,302,786
29,216
5,332,002
1.24
7,714,256
31,770
1.31
Obligations of Puerto Rico, States and
2,605
2,605
2,596
2,603
6.43
12,530
12,530
12,486
12,434
3.48
5.81
36,012
36,012
5,769
30,243
3,205
1,802
31,646
1.42
Total obligations of
Puerto Rico, States and
51,597
51,597
5,837
45,760
3,255
1,882
47,133
2.21
1,506
1,506
1,506
1,315
2.87
mortgage obligations -
federal agencies
1,506
1,506
1,506
1,315
2.87
Securities in wholly owned statutory business
trusts
5,960
5,960
5,960
5,960
6.33
Total securities
in wholly owned statutory
business trusts
5,960
5,960
5,960
5,960
6.33
held-to-maturity [2]
$
7,773,319
$
7,433,135
$
5,837
$
$
35,025
$
2,835
$
1.32
%
[1]
Book value includes $
million of unrealized loss which remains in Accumulated
other comprehensive (loss) income (AOCI) related
to certain
securities previously transferred from available-for-sale securities
portfolio to the held-to-maturity securities portfolio.
[2]
7.3
billion pledged to secure public and trust deposits that
the secured parties are not permitted to sell or repledge
the collateral.
The
Corporation had unpledged held-to-maturities securities with
a fair value of $
89.7
million that could be used to increase its borrowing facilities.
Value
Gross
Gross
Book
[1]
for Credit
Net of
Fair
average
cost
Value
Losses
gains
losses
value
yield
$
599,910
$
599,910
$
$
599,910
$
$
4,498
$
595,412
2.76
%
7,572,435
7,093,508
7,093,508
65,096
7,028,412
1.28
8,172,345
69,594
1.39
Obligations of Puerto Rico, States and
`
2,440
2,440
2,435
2,438
6.39
16,454
16,454
16,374
16,341
3.69
5.81
37,633
37,633
5,210
32,423
2,318
2,596
32,145
1.42
Total obligations of
Puerto Rico, States and
57,182
57,182
5,317
51,865
2,388
2,676
51,577
2.34
1,518
1,518
1,518
1,304
2.87
mortgage obligations -
federal agencies
1,518
1,518
1,518
1,304
2.87
Securities in wholly owned statutory business
trusts
5,959
5,959
5,959
5,959
6.33
Total securities
in wholly owned statutory
business trusts
5,959
5,959
5,959
5,959
6.33
held-to-maturity [2]
$
8,237,004
$
7,758,077
$
5,317
$
$
2,388
$
72,484
$
1.40
%
[1]
Book value includes $
million of unrealized loss which remains in Accumulated
other comprehensive (loss) income (AOCI) related
to certain
securities transferred from available-for-sale securities
portfolio to the held-to-maturity securities portfolio.
[2]
7.6
billion pledged to secure public and trust deposits that
the secured parties are not permitted to sell or repledge
the collateral. The
Corporation had unpledged held-to-maturities securities with
a fair value of $
139.9
million that could be used to increase its borrowing
facilities.
Debt securities not due on a single contractual maturity date,
such as collateralized mortgage obligations, are classified in the period
of final
contractual maturity.
The expected
maturities of
collateralized mortgage
obligations and
certain other
securities may
differ
from their contractual maturities because they may be
subject to prepayments or may be called
by the issuer.
Credit Quality Indicators
The following describes the credit quality indicators by major security
type that the Corporation considers to develop the
estimate of
the allowance for credit losses for investment securities
held-to-maturity.
As discussed in
Note 2 of
the 2024 Form
10-K, U.S. Treasury
securities carry an explicit
guarantee from the U.S.
Government are
highly rated by major rating
agencies and have a long
history of no credit losses. Accordingly,
the Corporation applies a zero-credit
loss assumption and no allowance for credit losses
(“ACL”) for these securities has been established.
At
2024, the
“Obligations of
States and
political subdivisions”
held-to-maturity,
included securities
issued by
generally not
rated by
a credit
rating agency.
performs periodic
credit quality
reviews of
these securities
and internally
assigns standardized
credit risk
ratings
based on its evaluation. For the definitions of the obligor risk ratings, refer to the Credit Quality section of Note 8 to the Consolidated
This includes
$
8.7
million of
general and
special obligation
bonds issued
by three
Puerto
Rico,
of
which
$
7.9
million
have
a
“Pass”
rating,
that
are
payable
from
certain
taxes
imposed
by
the
issuing
municipality (compared to $
11.1
million, respectively, at December 31, 2024).
the portfolio
of “Obligations
of Puerto
Rico, States
and political
subdivisions” also
included $
issued
by
the
Puerto
Rico
Housing
Finance
Authority
(“HFA”),
a
instrumentality,
for
which
the
source of payment is second mortgage loans in Puerto Rico
residential properties (not the government), but for which HFA, provides
a guarantee
in the
event of default
and upon the
satisfaction of certain
other conditions (December
31, 2024 -
$
million). These
are
not
rated
by
a
credit
rating
agency.
Refer
to
Note
to
the
for
information on the Corporation’s exposure to the Puerto
Rico Government
The
assesses
the
credit
risk
with
these
by
the
refreshed
FICO
scores
of
a
representative sample of
the underlying
borrowers. As
average refreshed FICO
score for
the sample,
comprised
of
%
of
the
nominal
value
of
the
used
for
the
loss
was
of
(compared
to
%
and
,
respectively, at
December 31, 2024).
The loss estimates
for this portfolio
was based on
the methodology established
under CECL
for
similar
loan
The
does
not
the
when
estimating
the
credit
losses
associated with this portfolio.
A
deterioration of
Rico economy
or
of
the fiscal
health of
the
Government of
and/or
its
(including if
any of
the issuing
municipalities become
a debt
restructuring proceeding
Management and Economic Stability Act (“PROMESA”) could
adversely affect the value of these securities, resulting in losses
to the
At September 30,
2025 and December 31,
2024, the portfolio of
“Obligations of Puerto Rico,
States and political subdivisions”
also
included $
6.9
securities issued
by the
HFA for
which the
underlying source
of payment
is U.S.
Treasury securities.
The
Corporation applies a zero-credit
loss assumption for these
securities, and no ACL
has been established for
these securities given
that U.S. Treasury
securities carry an
explicit guarantee from the
U.S. Government, are
highly rated by
major rating agencies,
and
have a long history of no credit losses.
Delinquency status
At September 30, 2025 and December 31, 2024, there
were
no
securities held-to-maturity in past due or non-performing
status.
Allowance for credit losses on debt securities held-to-maturity
The
for
credit
losses
related
to
the
Obligations
of
Puerto
Rico
and
the
States
and
Political
at
September 30, 2025 was $
5.8
5.3
Note 7 – Loans
For
a summary
of
the accounting
policies related
to
loans, interest
recognition and
allowance for
credit
losses
refer to
Note
–
Summary of Significant Accounting Policies of the 2024
Form 10-K.
The
table
the
Corporation's
loan
(including
repurchases)
for
the
quarters
and
nine
months
ended
September 30, 2025 and 2024 by class of loans:
$
40,797
$
32,484
$
115,683
$
247,906
122,452
97,586
369,049
268,239
$
163,249
$
130,070
$
484,732
$
516,145
whole-loan sales for
the quarters
2024 by class of loans:
$
19,998
$
$
47,347
$
9,338
11,656
11,393
9,126
26,780
32,882
$
31,391
$
9,126
$
83,465
$
44,538
Delinquency status
The following tables present the
amortized cost basis of loans
held-in-portfolio (“HIP”), net of unearned
income, by past due status,
and by loan class including those that are in non-performing status or that are accruing
interest but are past due 90 days or more at
BPPR
30-59
60-89
90 days
Total
days
days
or more
Current
loans
loans
$
1,357
$
$
$
1,532
$
300,834
$
302,366
$
$
17,422
37,043
54,757
3,247,988
3,302,745
37,043
2,004
25,619
27,775
1,167,509
1,195,284
25,619
4,237
2,032
178,224
184,493
5,567,505
5,751,998
173,245
4,979
2,898
1,691
4,589
299,364
303,953
252,650
118,092
314,103
684,845
6,548,261
7,233,106
139,958
174,145
Leasing
23,537
5,372
7,747
36,656
1,961,995
7,747
13,556
9,917
25,625
49,098
1,176,469
25,625
1,693
1,693
19,826
11,353
18,375
49,554
1,773,594
1,823,148
18,375
Auto
107,907
21,874
49,432
179,213
3,671,740
49,432
Other
2,907
2,195
5,347
166,980
172,327
1,776
Total
$
448,301
$
171,021
$
658,537
$
1,277,859
$
25,883,932
$
27,161,791
$
453,369
$
205,168
30-59
60-89
90 days
Total
days
days
or more
Current
loans
loans
$
$
2,638
$
8,467
$
11,105
$
2,176,118
$
2,187,223
$
8,467
$
7,083
7,167
2,152,668
2,159,835
7,083
15,171
15,388
1,880,052
1,895,440
14,949
1,434
16,383
2,477,258
2,493,641
1,246
1,298
4,988
27,809
34,095
1,291,207
1,325,302
27,809
Home equity lines of
credit
3,257
3,987
73,210
77,197
3,257
1,006
2,937
74,240
77,177
Other
8,863
8,893
Total
$
32,903
$
9,168
$
49,021
$
91,092
$
11,434,275
$
11,525,367
$
48,833
$
30-59
60-89
90 days
Total
days
days
or more
Current
[2] [3]
loans
loans
$
1,357
$
2,639
$
8,641
$
12,637
$
2,476,952
$
$
8,641
$
17,506
44,126
61,924
5,400,656
44,126
17,175
25,619
43,163
3,047,561
25,619
19,186
2,032
179,658
200,876
8,044,763
174,491
5,167
2,898
1,691
4,589
1,600,023
[1]
253,948
123,080
341,912
718,940
7,839,468
167,767
174,145
Leasing
23,537
5,372
7,747
36,656
1,961,995
7,747
13,556
9,917
25,625
49,098
1,176,469
25,625
3,257
3,987
74,903
78,890
3,257
20,832
12,343
19,316
52,491
1,847,834
19,316
Auto
107,907
21,874
49,432
179,213
3,671,740
49,432
Other
2,907
2,225
5,377
175,843
181,220
1,806
Total
$
481,204
$
180,189
$
707,558
$
1,368,951
$
37,318,207
$
$
502,202
$
205,356
[1]
At September 30, 2025, mortgage loans held-in-portfolio
include $
.0 billion of loans that carry certain guarantees from
the FHA or the VA, for
which the Corporation’s policy is to exclude them
from non-performing status, of which $
million are 90 days or more past due. The portfolio
of
guaranteed loans includes $
million of residential mortgage loans in Puerto Rico that
are no longer accruing interest as of September 30,
The Corporation has $
million in reverse mortgage loans in Puerto Rico which
are guaranteed by FHA, but which are currently not accruing
interest at September 30, 2025.
[2]
Loans held-in-portfolio are net of $
million in unearned income and exclude $
million in loans held-for-sale.
[3]
21.9
billion pledged to secure credit facilities and public funds
that the secured parties are not permitted to sell or repledge
the collateral,
7.5
billion were pledged at the Federal Home Loan Bank
("FHLB") as collateral for borrowings and $
14.4
billion at the Federal Reserve
Bank ("FRB") for discount window borrowings. As of September
30, 2025, the Corporation had an available borrowing
facility with the FHLB and
the discount window of FRB of $
4.2
11.2
billion, respectively.
BPPR
30-59
60-89
90 days
Total
days
days
or more
Current
loans
loans
$
1,491
$
$
$
1,683
$
306,318
$
308,001
$
$
3,103
6,429
10,118
3,236,385
3,246,503
6,429
11,054
25,258
37,120
1,338,791
1,375,911
25,258
5,738
2,712
23,895
32,345
5,314,549
5,346,894
19,335
4,560
1,039
1,039
211,251
212,290
262,222
116,694
365,759
744,675
6,065,206
6,809,881
158,442
207,317
Leasing
23,991
6,062
9,588
39,641
1,885,764
9,588
17,399
11,719
29,960
59,078
1,158,975
29,960
1,895
2,040
19,503
13,005
20,269
52,777
1,697,600
1,750,377
20,269
Auto
111,358
27,858
51,792
191,008
3,632,429
51,792
Other
1,816
1,312
3,405
156,824
160,229
Total
$
458,730
$
179,963
$
534,341
$
1,173,034
$
25,005,987
$
26,179,021
$
292,091
$
242,250
30-59
60-89
90 days
Total
days
days
or more
Current
loans
loans
$
$
5,443
$
8,700
$
14,143
$
2,077,476
$
2,091,619
$
8,700
$
6,792
8,015
14,807
2,101,925
2,116,732
8,015
5,191
5,191
1,776,644
1,781,835
5,191
10,336
5,323
1,938
17,597
2,377,071
2,394,668
1,748
18,148
5,417
29,890
53,455
1,250,847
1,304,302
29,890
3,393
4,909
66,622
71,531
3,393
1,808
1,509
1,741
5,058
99,809
104,867
1,741
Other
11,024
11,549
Total
$
38,128
$
18,678
$
58,879
$
115,685
$
10,812,946
$
10,928,631
$
58,689
$
30-59
60-89
90 days
Total
days
days
or more
Current
[2] [3]
loans
loans
$
1,491
$
5,556
$
8,779
$
15,826
$
2,383,794
$
$
8,779
$
9,895
14,444
24,925
5,338,310
14,444
11,054
30,449
42,311
3,115,435
30,449
16,074
8,035
25,833
49,942
7,691,620
21,083
4,750
1,039
1,039
1,262,753
[1]
280,370
122,111
395,649
798,130
7,316,053
188,332
207,317
Leasing
23,991
6,062
9,588
39,641
1,885,764
9,588
17,399
11,719
29,960
59,078
1,159,001
29,960
1,115
3,393
5,054
68,517
73,571
3,393
21,311
14,514
22,010
57,835
1,797,409
22,010
Auto
111,358
27,858
51,792
191,008
3,632,429
51,792
Other
2,330
1,323
3,930
167,848
171,778
Total
$
496,858
$
198,641
$
593,220
$
1,288,719
$
35,818,933
$
$
350,780
$
242,440
[1]
At December 31, 2024 mortgage loans held-in-portfolio include
$
2.6
billion of loans that carry certain guarantees from the FHA
or the VA, for
which the Corporation’s policy is to exclude them
from non-performing status, of which $
million are 90 days or more past due. The portfolio
of
guaranteed loans includes $
million of residential mortgage loans in Puerto Rico that
are no longer accruing interest as of December 31,
The Corporation has $
million in reverse mortgage loans in Puerto Rico which
are guaranteed by FHA, but which are currently not accruing
interest at December 31, 2024.
[2]
Loans held-in-portfolio are net of $
million in unearned income and exclude $
million in loans held-for-sale.
[3]
16.8
billion pledged to secure credit facilities and public funds
that the secured parties are not permitted to sell or repledge
the collateral,
7.3
billion were pledged at the FHLB as collateral for borrowings
and $
9.5
billion at the FRB for discount window borrowings. As
of
December 31, 2024, the Corporation had an available borrowing
facility with the FHLB and the discount window
of FRB of $
3.8
.0
billion, respectively.
The following tables present the amortized cost basis
of non-accrual loans as of September 30, 2025
and December 31, 2024 by
class of loans:
BPPR
with no
with
with no
with
with no
with
$
$
$
8,137
$
$
8,137
$
34,986
2,057
6,994
41,980
2,146
16,618
9,001
16,618
9,001
6,504
166,741
1,246
6,504
167,987
62,445
77,513
1,117
26,692
63,562
104,205
Leasing
7,145
7,145
HELOCs
3,257
3,257
3,264
15,111
3,264
16,052
Auto
2,263
47,169
2,263
47,169
Other
1,413
1,443
Total
$
127,045
$
326,324
$
16,248
$
32,585
$
143,293
$
358,909
BPPR
with no
with
with no
with
with no
with
$
$
$
8,700
$
$
8,700
$
3,450
2,979
7,115
10,565
3,879
17,767
7,491
4,957
22,724
7,725
9,020
10,315
1,748
9,020
12,063
66,176
92,266
1,069
28,821
67,245
121,087
Leasing
9,088
9,088
HELOCs
3,393
3,393
2,960
17,309
1,741
2,960
19,050
Auto
1,992
49,800
1,992
49,800
Other
Total
$
101,865
$
190,226
$
21,841
$
36,848
$
123,706
$
227,074
The Corporation has
designated loans classified as
collateral dependent for
which the ACL
is measured based
on the fair
the collateral less
cost to sell,
when foreclosure is
probable or when
the repayment is
expected to be
provided substantially by the
sale or
operation of
the collateral
and the
borrower is
experiencing financial
difficulty.
The fair
the collateral
is based
on
appraisals,
which
may
be
adjusted
due
to
their
age,
type,
location,
and
condition
of
the
or
area
or
general
market
conditions to reflect the expected change in value between the effective date
of the appraisal and the measurement date. Appraisals
are updated every one to two years depending on
the type of loan and the total exposure of
the borrower.
Loans in non-accrual status with no allowance at September 30, 2025 include $
million in collateral dependent loans (December
31,
2024 -
$
million). The
$
interest income
on non-accrual
loans during
the
ended September 30, 2025 (September 30, 2024
- $
The following tables present the amortized cost basis
of collateral-dependent loans, for which the ACL was measured
based on the
of the
collateral less
cost to
sell, by
class of
loans and
type of
collateral as
of September
and December
31,
2024:
Real Estate
Auto
Equipment
Accounts
Receivables
Other
Total
BPPR
$
1,221
$
$
$
$
$
1,221
128,209
128,209
23,060
23,060
2,409
4,404
1,383
2,781
10,977
70,547
70,547
Leasing
1,597
1,597
3,724
3,724
Auto
16,694
16,694
Other
$
229,170
$
18,299
$
4,404
$
1,383
$
3,144
$
256,400
$
13,915
$
$
$
$
$
13,915
65,645
65,645
1,651
1,651
$
81,211
$
$
$
$
$
81,211
$
15,136
$
$
$
$
$
15,136
193,854
193,854
23,060
23,060
2,409
4,404
1,383
2,781
10,977
72,198
72,198
Leasing
1,597
1,597
3,724
3,724
Auto
16,694
16,694
Other
Inc.
$
310,381
$
18,299
$
4,404
$
1,383
$
3,144
$
337,611
Real Estate
Auto
Equipment
Other
Total
BPPR
$
1,278
$
$
$
$
1,278
145,974
145,974
23,361
23,361
2,754
11,593
14,347
77,910
77,910
Leasing
1,437
1,438
3,347
3,347
Auto
15,782
15,782
Other
$
255,200
$
17,219
$
$
11,609
$
284,029
$
14,517
$
$
$
$
14,517
7,116
7,116
4,956
4,956
1,154
1,172
1,430
1,430
$
28,019
$
$
$
1,154
$
29,191
$
15,795
$
$
$
$
15,795
153,090
153,090
28,317
28,317
2,754
12,747
15,519
79,340
79,340
Leasing
1,437
1,438
3,347
3,347
Auto
15,782
15,782
Other
Inc.
$
283,219
$
17,219
$
$
12,763
$
313,220
Note 8 – Allowance for credit losses – loans
The
Corporation follows
the current
expected credit
loss
(“CECL”) model
to
establish and
evaluate the
adequacy of
the ACL
to
provide for
expected losses
in the
loan portfolio.
This model
establishes a forward-looking
methodology that
reflects the
credit losses over the lives
of financial assets starting when such
assets are first acquired or originated.
In addition, CECL provides
that
the
initial ACL
on PCD
assets be
recorded as
an
increase to
the
purchase price,
with subsequent
changes to
the
as
a
credit
loss
expense.
The
for
credit
losses
in
current
is
based
on
this
methodology.
Loan losses
are charged
and
recoveries are
credited to
the ACL.
The
Corporation’s modeling
framework includes
competing risk
models that
generate lifetime
default and
prepayment estimates as
well as
other loan
level techniques
to estimate
loss
severity.
These
models
combine
credit
risk
factors
which
include
the
impact
of
loan
modifications,
with
macroeconomic
expectations to derive the lifetime expected loss.
At
30,
2025,
the
estimated
the
ACL
by
weighting
the
outputs
of
optimistic,
baseline,
and
scenarios. The
weightings applied are
evaluation on a
quarterly basis as
part of
the ACL’s
governance process.
During
the first quarter of 2025, the Corporation assigned equal probability weights to the baseline and pessimistic scenarios in response to
economic uncertainty,
the optimistic scenario
being the lowest
of probabilities. During
quarter of 2025,
moderately
reduced
the
weight
for
the
based
on
changes
in
the
outlook
and
a
reassessment of uncertainty compared to the first quarter. The net impact of these two changes in the assigned weights on the ACL
levels
for
the
nine
months
ended
30,
was
$
13.7
million
in
reserves.
There
were
no
changes
to
the
probability weights
of
- The
probability weight
for the
pessimistic scenario
remains above
the levels
observed in 2024, given the ongoing economic uncertainty.
The following tables present the changes in
the ACL of loans held-in-portfolio and
unfunded commitments for the quarters and nine
months ended September 30, 2025 and 2024.
BPPR
Ending
Balance
Balance
$
3,696
$
(177)
$
$
$
$
3,521
43,139
10,931
(13,490)
41,456
35,848
(2,211)
34,584
123,202
30,220
(2,801)
1,334
151,955
205,885
38,763
(16,291)
3,159
231,516
3,075
3,445
74,966
(585)
2,801
77,525
Leasing
20,040
1,234
(4,017)
1,963
19,220
92,306
10,212
(18,139)
2,829
87,208
(95)
92,891
13,195
(19,218)
3,533
90,401
Auto
182,274
7,581
(19,175)
7,139
177,819
Other
7,758
1,042
(759)
8,173
375,283
31,935
(57,291)
13,722
363,649
$
679,249
$
72,639
$
$
(78,184)
$
21,645
$
695,355
$
5,876
$
$
$
$
$
6,819
1,869
(127)
1,742
$
7,745
$
$
$
$
$
8,561
[1] Allowance for credit losses of unfunded commitments
is presented as part of Other Liabilities in the Consolidated
Ending
Balance
Balance
$
13,085
$
(84)
$
$
$
13,061
15,978
1,411
17,389
13,203
1,388
14,607
18,160
(148)
(722)
17,352
60,426
2,567
(722)
62,409
7,504
7,659
10,209
(789)
9,456
1,330
(253)
1,500
10,763
(1,629)
9,837
Other
(25)
12,097
(55)
(1,654)
11,341
$
90,236
$
1,878
$
(2,376)
$
1,127
$
90,865
$
1,935
$
(7)
$
$
$
1,928
3,289
(100)
3,189
$
5,308
$
(46)
$
$
$
5,262
[1]
Ending
Balance
Balance
$
16,781
$
(261)
$
$
$
$
16,582
59,117
12,342
(13,490)
58,845
49,051
(823)
49,191
141,362
30,072
(3,523)
1,396
169,307
266,311
41,330
(17,013)
3,297
293,925
10,579
11,104
85,175
(452)
(585)
2,837
86,981
Leasing
20,040
1,234
(4,017)
1,963
19,220
92,306
10,212
(18,139)
2,829
87,208
1,384
(348)
1,548
103,654
13,378
(20,847)
4,053
100,238
Auto
182,274
7,581
(19,175)
7,139
177,819
Other
7,762
1,057
(784)
8,177
387,380
31,880
(58,945)
14,675
374,990
$
769,485
$
74,517
$
$
(80,560)
$
22,772
$
786,220
$
7,811
$
$
$
$
$
8,747
5,158
(227)
4,931
$
13,053
$
$
$
$
$
13,823
[1]
BPPR
Ending
Balance
Balance
$
2,783
$
$
$
$
$
3,521
44,852
8,172
(13,576)
2,008
41,456
37,355
(5,129)
(103)
2,461
34,584
130,136
23,194
(8,579)
7,204
151,955
215,126
26,965
(22,258)
11,683
231,516
2,743
3,445
72,901
(2,533)
(1,570)
8,712
77,525
Leasing
16,419
10,863
(12,543)
4,481
19,220
99,130
37,128
(57,015)
7,965
87,208
(516)
(25)
91,296
48,904
(60,724)
10,925
90,401
Auto
165,995
43,904
(53,649)
21,569
177,819
Other
7,002
3,062
(2,339)
8,173
363,477
132,482
(173,752)
41,442
363,649
$
670,666
$
168,479
$
$
(210,123)
$
66,318
$
695,355
$
6,725
$
$
$
$
$
6,819
1,663
1,742
$
8,388
$
$
$
$
$
8,561
[1]
Ending
Balance
Balance
$
6,453
$
7,110
$
(563)
$
$
13,061
9,642
7,747
17,389
12,473
1,581
(26)
14,607
15,870
2,862
(1,918)
17,352
44,438
19,300
(2,507)
1,178
62,409
8,521
(862)
7,659
9,508
(305)
9,456
1,449
(1,188)
(46)
1,285
1,500
11,440
3,800
(7,175)
1,772
9,837
Other
(67)
12,891
2,662
(7,288)
3,076
11,341
$
75,358
$
20,795
$
(9,795)
$
4,507
$
90,865
$
1,662
$
$
$
$
1,928
5,409
(2,220)
3,189
$
7,082
$
(1,820)
$
$
$
5,262
[1]
Ending
Balance
Balance
$
9,236
$
7,838
$
$
(563)
$
$
16,582
54,494
15,919
(13,576)
2,008
58,845
49,828
(3,548)
(129)
3,040
49,191
146,006
26,056
(10,497)
7,742
169,307
259,564
46,265
(24,765)
12,861
293,925
11,264
(160)
11,104
82,409
(2,838)
(1,570)
8,965
86,981
Leasing
16,419
10,863
(12,543)
4,481
19,220
99,130
37,128
(57,015)
7,965
87,208
1,503
(1,704)
(71)
1,820
1,548
102,736
52,704
(67,899)
12,697
100,238
Auto
165,995
43,904
(53,649)
21,569
177,819
Other
7,004
3,112
(2,406)
8,177
376,368
135,144
(181,040)
44,518
374,990
$
746,024
$
189,274
$
$
(219,918)
$
70,825
$
786,220
$
8,387
$
$
$
$
$
8,747
7,072
(2,141)
4,931
$
15,470
$
(1,647)
$
$
$
$
13,823
[1]
BPPR
Ending
Balance
Balance
$
3,303
$
(417)
$
$
$
$
2,886
53,386
3,344
(69)
56,720
39,375
(2,418)
(2)
1,556
38,511
111,263
16,597
(6,190)
1,461
123,131
207,327
17,106
(6,261)
3,076
221,248
3,638
(970)
1,036
3,704
73,900
(5,221)
(208)
4,102
72,576
Leasing
14,385
3,725
(3,630)
1,374
15,854
86,313
21,238
(17,503)
2,646
92,694
(90)
(82)
94,021
20,232
(24,712)
2,526
92,067
Auto
157,449
20,765
(23,011)
6,110
161,313
Other
6,489
(728)
6,649
344,355
62,507
(66,036)
11,966
352,792
$
643,605
$
77,147
$
$
(76,135)
$
21,554
$
666,174
$
5,540
$
$
$
$
$
6,356
2,095
2,468
$
7,635
$
1,189
$
$
$
$
8,824
[1]
Ending
Balance
Balance
$
7,877
$
(1,126)
$
$
$
6,756
10,849
(54)
10,910
18,815
(4,430)
14,404
15,219
(1,617)
(613)
13,230
52,760
(7,120)
(667)
45,300
9,251
9,510
9,389
(361)
9,074
1,643
(4)
1,785
13,427
2,799
(4,442)
12,475
Other
(28)
15,072
2,844
(4,474)
14,262
$
86,472
$
(4,378)
$
(5,141)
$
1,193
$
78,146
$
2,850
$
(1,080)
$
$
$
1,770
8,399
(609)
7,790
$
11,249
$
(1,689)
$
$
$
9,560
[1]
Ending
Balance
Balance
$
11,180
$
(1,543)
$
$
$
$
9,642
64,235
3,397
(123)
67,630
58,190
(6,848)
(2)
1,575
52,915
126,482
14,980
(6,803)
1,702
136,361
260,087
9,986
(6,928)
3,403
266,548
12,889
(711)
1,036
13,214
83,289
(5,582)
(208)
4,148
81,650
Leasing
14,385
3,725
(3,630)
1,374
15,854
86,313
21,238
(17,503)
2,646
92,694
1,726
(68)
(86)
1,854
107,448
23,031
(29,154)
3,217
104,542
Auto
157,449
20,765
(23,011)
6,110
161,313
Other
6,491
(756)
6,651
359,427
65,351
(70,510)
12,786
367,054
$
730,077
$
72,769
$
$
(81,276)
$
22,747
$
744,320
$
8,390
$
(264)
$
$
$
$
8,126
10,494
(236)
10,258
$
18,884
$
(500)
$
$
$
$
18,384
[1]
BPPR
Ending
Balance
Balance
$
3,614
$
(729)
$
$
$
$
2,886
53,754
2,607
(69)
56,720
40,637
(2,567)
(2,787)
3,228
38,511
107,577
31,413
(20,931)
5,072
123,131
205,582
30,724
(23,787)
8,729
221,248
5,294
(2,626)
1,036
3,704
72,440
(11,959)
(999)
13,068
72,576
Leasing
9,708
14,787
(12,321)
3,680
15,854
80,487
54,734
(50,318)
7,791
92,694
(373)
101,181
55,987
(72,354)
7,253
92,067
Auto
157,931
44,386
(59,787)
18,783
161,313
Other
7,132
(2,072)
6,649
346,834
155,814
(184,904)
35,048
352,792
$
639,858
$
186,740
$
$
(222,011)
$
61,561
$
666,174
$
5,062
$
1,294
$
$
$
$
6,356
1,618
2,468
$
6,680
$
2,144
$
$
$
$
8,824
[1]
Ending
Balance
Balance
$
10,126
$
(2,939)
$
(441)
$
$
6,756
11,699
(903)
(54)
10,910
16,227
(1,925)
14,404
14,779
(2,372)
13,230
52,831
(5,548)
(2,867)
45,300
7,392
2,018
9,510
10,774
(1,788)
(18)
9,074
1,875
(741)
(25)
1,785
16,609
8,585
(14,750)
2,031
12,475
Other
(77)
18,486
7,890
(14,852)
2,738
14,262
$
89,483
$
2,572
$
(17,737)
$
3,828
$
78,146
$
1,851
$
(81)
$
$
$
1,770
8,446
(656)
7,790
(29)
$
10,326
$
(766)
$
$
$
9,560
[1]
Ending
Balance
Balance
$
13,740
$
(3,668)
$
$
(441)
$
$
9,642
65,453
1,704
(123)
67,630
56,864
(4,492)
(2,787)
3,330
52,915
122,356
31,632
(23,303)
5,676
136,361
258,413
25,176
(26,654)
9,613
266,548
12,686
(608)
1,136
13,214
83,214
(13,747)
(1,017)
13,174
81,650
Leasing
9,708
14,787
(12,321)
3,680
15,854
80,487
54,734
(50,318)
7,791
92,694
1,978
(706)
(398)
1,854
117,790
64,572
(87,104)
9,284
104,542
Auto
157,931
44,386
(59,787)
18,783
161,313
Other
7,134
(2,149)
6,651
365,320
163,704
(199,756)
37,786
367,054
$
729,341
$
189,312
$
$
(239,748)
$
65,389
$
744,320
$
6,913
$
1,213
$
$
$
$
8,126
10,064
10,258
(29)
$
17,006
$
1,378
$
$
$
$
18,384
[1]
Statements of Financial
Condition.
Modifications
A
modification
constitutes
a
change
in
loan
terms
in
the
form
of
forgiveness,
an
rate
reduction,
other
than-
insignificant payment delay, term extension or combination of the above made
to a borrower experiencing financial difficulty.
The amount of outstanding commitments to lend additional funds to debtors with financial difficulties owing receivables whose terms
have been modified during the nine months ended September 30, 2025 amounted to $
million (during the year ended December
31, 2024 - $
million), related to the commercial loan portfolios.
The following tables show the amortized cost basis of the loans modified to borrowers experiencing financial difficulties at the end of
the reporting period disaggregated by class of financing receivable and type of concession granted for the quarters and nine months
ended
30,
and
Loans
to
experiencing
difficulties
that
were
fully
paid
down,
charged-off or foreclosed upon by period end are not reported.
Difficulty for the quarter ended September 30,
BPPR
$
0.01
%
$
%
$
0.01
%
0.02
%
%
0.02
%
0.04
%
%
0.04
%
Total
$
1,657
0.01
%
$
%
$
1,657
%
BPPR
$
1,670
0.05
%
$
%
$
1,670
0.03
%
13,618
1.14
%
%
13,618
0.44
%
8,172
0.14
%
0.04
%
9,097
0.11
%
15,194
0.21
%
0.04
%
15,660
0.18
%
0.01
%
0.01
%
0.01
%
Auto
%
%
%
Total
$
38,895
0.14
%
$
1,399
0.01
%
$
40,294
0.10
%
BPPR
$
22,889
1.91
%
$
%
$
22,889
0.74
%
79,734
1.39
%
%
79,734
0.97
%
%
%
%
Total
$
102,926
0.38
%
$
%
$
102,926
0.27
%
BPPR
$
0.01
%
$
%
$
0.01
%
2,739
0.05
%
%
2,739
0.03
%
2,153
0.03
%
%
2,153
0.03
%
2,925
0.16
%
0.05
%
2,964
0.16
%
Auto
%
%
%
Total
$
8,010
0.03
%
$
%
$
8,049
0.02
%
Combination -
Other-Than-Insignificant Payment Delays and Interest Rate
BPPR
$
0.01
%
$
%
$
%
2,666
0.22
%
%
2,666
0.22
%
Total
$
3,037
0.01
%
$
%
$
3,037
0.01
%
Difficulty for the nine months ended September
BPPR
$
2,692
0.05
%
$
%
$
2,692
0.03
%
%
%
%
0.05
%
%
0.05
%
2,782
0.15
%
%
2,782
0.15
%
Other
%
%
%
Total
$
6,165
0.02
%
$
%
$
6,165
0.02
%
BPPR
$
1,773
0.05
%
$
58,652
2.72
%
$
60,425
1.11
%
18,854
1.58
%
%
18,854
0.61
%
16,163
0.28
%
0.04
%
17,088
0.21
%
37,568
0.52
%
1,130
0.09
%
38,698
0.45
%
0.03
%
0.01
%
0.03
%
Auto
%
%
%
Total
$
75,167
0.28
%
$
60,715
0.53
%
$
135,882
0.35
%
BPPR
$
29,763
2.49
%
$
%
$
29,763
0.96
%
165,360
2.87
%
%
165,360
2.01
%
0.01
%
%
0.01
%
Total
$
195,844
0.72
%
$
%
$
195,844
0.51
%
BPPR
$
0.01
%
$
%
$
0.01
%
2,837
0.05
%
%
2,837
0.03
%
9,202
0.13
%
%
9,202
0.11
%
9,187
0.50
%
0.20
%
9,341
0.49
%
Auto
%
%
%
Total
$
21,435
0.08
%
$
%
$
21,589
0.06
%
Combination - Other-Than-Insignificant Payment Delays
BPPR
$
1,157
0.02
%
$
%
$
1,157
0.01
%
7,175
0.59
%
%
7,175
0.59
%
Total
$
8,332
0.03
%
$
%
$
8,332
0.02
%
Difficulty for the quarter ended September 30,
BPPR
$
0.01
%
$
%
$
%
0.01
%
%
0.01
%
0.02
%
%
0.02
%
0.05
%
%
0.04
%
Total
$
1,883
0.01
%
$
%
$
1,883
0.01
%
BPPR
$
%
$
10,570
0.50
%
$
10,570
0.44
%
13,108
0.42
%
%
13,108
0.25
%
0.05
%
%
0.02
%
20,966
0.41
%
%
20,966
0.28
%
0.40
%
%
0.07
%
11,850
0.18
%
0.03
%
12,279
0.15
%
0.01
%
%
0.01
%
Total
$
47,604
0.19
%
$
10,999
0.11
%
$
58,603
0.16
%
BPPR
$
%
$
%
$
%
4,993
0.36
%
%
4,993
0.16
%
71,867
1.39
%
%
71,867
0.97
%
%
%
%
Total
$
77,004
0.30
%
$
%
$
77,004
0.21
%
BPPR
$
0.01
%
$
%
$
0.01
%
%
%
%
4,728
0.07
%
%
4,728
0.06
%
2,569
0.15
%
0.05
%
2,634
0.14
%
Total
$
7,543
0.03
%
$
%
$
7,608
0.02
%
Combination -
Other-Than-Insignificant Payment Delays and Interest Rate
BPPR
$
%
$
%
$
%
0.07
%
%
0.07
%
Total
$
%
$
%
$
%
Difficulty for the nine months ended September
BPPR
$
0.01
%
$
%
$
0.01
%
2,756
0.05
%
%
2,756
0.04
%
%
%
%
0.06
%
%
0.06
%
1,873
0.11
%
%
1,873
0.10
%
Other
0.02
%
%
0.01
%
Total
$
5,591
0.02
%
$
%
$
5,591
0.02
%
BPPR
$
%
$
10,570
0.50
%
$
10,570
0.44
%
55,655
1.77
%
%
55,655
1.07
%
11,482
0.82
%
6,033
0.36
%
17,515
0.57
%
23,837
0.46
%
%
23,837
0.32
%
0.40
%
%
0.07
%
41,649
0.62
%
1,075
0.08
%
42,724
0.53
%
0.03
%
%
0.03
%
Auto
%
%
%
Total
$
133,981
0.52
%
$
17,678
0.17
%
$
151,659
0.42
%
BPPR
$
%
$
%
$
%
20,591
1.47
%
%
20,591
0.67
%
75,231
1.45
%
%
75,231
1.02
%
%
%
%
%
%
%
Total
$
96,093
0.37
%
$
%
$
96,093
0.27
%
BPPR
$
0.03
%
$
%
$
0.02
%
0.01
%
%
0.01
%
0.01
%
%
0.01
%
13,404
0.20
%
0.01
%
13,471
0.17
%
5,755
0.33
%
0.26
%
6,067
0.32
%
Total
$
20,865
0.08
%
$
%
$
21,244
0.06
%
Combination - Other-Than-Insignificant Payment Delays
BPPR
$
%
$
$
%
1,335
0.11
%
1,335
0.11
%
Total
$
1,445
0.01
%
$
$
1,445
%
The following tables describe the financial effect of the
modifications made to borrowers experiencing
financial difficulties:
.0% to
7.5
%
14.4
% to
.0%.
6.9
% to
5.4
%.
20.6
% to
8.5
%.
20.1
% to
11.6
%.
Auto
8.2
0% to
8.19
%.
Auto
Other than insignificant payment delays
10.0
% to
7.5
%.
18.6
% to
8.7
%.
6.8
% to
5.5
%.
20.9
% to
8.4
%.
21.1
% to
11.7
%.
Auto
11.86
% to
11.85
%.
Other
.0% to
.0%.
Auto
10.5
% to
6.6
%.
25.8
% to
10.2
%.
5.9
% to
4.3
%.
21.5
% to
.0%.
19.5
% to
10.4
%.
year to the life of loans.
10.1
% to
8.3
%.
10.6
% to
6.5
%.
20.6
% to
9.6
%.
6.1
% to
4.4
%.
20.9
% to
6.5
%.
19.1
% to
.0%.
Other
.0% to
.0%.
Auto
The
tables
present,
by
class,
the
of
loans
that
have
been
during
the
twelve
months
preceding
September 30, 2025.
The past due
90 days
or more categories
include all loans
modified classified as
non-accruing at the
time of
the modification. These loans will continue in non-accrual status, and presented as past due 90 days or more, until the borrower has
demonstrated a willingness and
ability to make
the restructured loan payments
(at least six
months of sustained
performance after
the modification
or one
year for
loans providing
for quarterly
or semi-annual
payments) and
management has
concluded that
it is
probable that the borrower would not be in payment
default in the foreseeable future.
BPPR
due
Current
Total
Default
Without
$
$
$
2,084
$
2,084
$
$
2,084
$
$
1,773
2,572
2,707
56,062
58,769
2,509
3,055
3,401
187,480
190,881
2,535
5,717
2,960
20,001
28,678
30,224
58,902
6,851
13,150
1,319
2,749
6,811
9,560
1,135
2,211
3,136
13,210
16,346
1,855
Auto
Other
Total
$
7,372
$
4,141
$
31,242
$
42,755
$
294,046
$
336,801
$
9,236
$
22,006
due
Current
Total
Default
Without
$
$
$
$
$
58,652
$
58,652
$
$
1,422
1,422
1,519
1,519
Total
$
$
$
$
$
61,757
$
61,798
$
$
due
Current
Total
Default
Without
$
$
$
2,084
$
2,084
$
58,652
$
60,736
$
$
1,773
2,572
2,707
56,062
58,769
2,509
3,055
3,401
188,902
192,303
2,535
5,717
2,960
20,001
28,678
31,743
60,421
6,851
13,150
1,319
2,749
6,811
9,560
1,135
2,224
3,177
13,374
16,551
1,855
Auto
Other
Total
$
7,400
$
4,141
$
31,255
$
42,796
$
355,803
$
398,599
$
9,249
$
22,006
to make the restructured loan payments.
Payment default is defined as a restructured loan becoming
90 days past due after being modified, foreclosed
or
The
tables
present,
by
class,
the
of
loans
that
have
been
during
the
twelve
months
preceding
September 30, 2024.
BPPR
due
Current
Total
Default
Without
$
$
$
$
$
$
$
$
2,798
2,798
55,766
58,564
2,798
2,232
2,324
36,355
38,679
2,143
12,359
4,817
17,202
86,203
103,405
4,721
5,649
4,359
24,206
34,214
40,358
74,572
6,609
17,597
1,715
2,284
1,914
2,251
6,854
9,105
1,704
Auto
Other
Total
$
18,615
$
4,517
$
36,347
$
59,479
$
228,092
$
287,571
$
7,201
$
29,146
due
Current
Total
Default
Without
$
$
$
$
$
10,570
$
10,570
$
$
39,855
39,855
1,202
Total
$
$
$
$
$
51,048
$
51,957
$
$
due
Current
Total
Default
Without
$
$
$
$
$
10,570
$
10,633
$
$
2,798
2,798
55,766
58,564
2,798
2,232
2,324
76,210
78,534
2,143
12,359
4,817
17,202
86,203
103,405
4,721
5,649
4,359
25,001
35,009
40,765
75,774
6,609
18,392
1,715
2,284
1,999
2,365
7,070
9,435
1,789
Auto
Other
Total
$
18,644
$
4,517
$
37,227
$
60,388
$
279,140
$
339,528
$
7,201
$
30,026
to make the restructured loan payments.
Payment default is defined as a restructured loan becoming
90 days past due after being modified, foreclosed
or
Payment
default
is
defined
as
a
restructured
loan
becoming
days
past
due
after
being
modified,
foreclosed
or
charged-off,
whichever
occurs
first.
The
tables
provide
the
balance
of
loans
for
under
difficulties that were subject to payment default and that
had been modified during the twelve months prior
to default.
Subsequently Defaulted During the Quarter Ended September
Total
$
$
$
$
$
$
6,021
6,826
1,208
Total
$
$
6,152
$
$
$
1,088
$
9,279
Subsequently Defaulted During the Nine Months Ended
Total
$
$
$
$
$
$
12,784
1,835
14,855
1,298
1,738
Total
$
1,016
$
12,960
$
$
1,940
$
1,637
$
18,525
Subsequently Defaulted During the Quarter Ended September
Total
$
$
$
$
$
$
5,911
6,957
Total
$
$
5,998
$
$
1,037
$
$
7,685
Subsequently Defaulted During the Nine Months Ended
Total
$
$
$
$
$
$
9,130
9,197
12,281
2,177
14,585
Total
$
$
21,989
$
$
2,435
$
$
25,306
Credit Quality
The risk
rating system
provides for
the assignment
of ratings
at the
obligor level
condition of
the borrower.
The
risk rating
analysis process
is
performed at
least
once a
year
or more
frequently if
events or
conditions change
which may
deteriorate the credit quality.
In the case of
consumer and mortgage loans, these
loans are classified considering their
delinquency
status at the end of the reporting period.
The following tables present the amortized cost basis, net of unearned income, of
loans held-in-portfolio based on the Corporation’s
assignment of obligor
risk ratings as
defined at September
30, 2025 and
and the gross
write-offs recorded by
vintage year. For
the definitions of the obligor risk ratings,
refer to the Credit Quality section of
Note 8 to the Consolidated Financial
Statements included in the 2024 Form 10-K:
Loans
Loans
Prior
Years
Total
BPPR
Pass
$
5,767
$
33,483
$
36,660
$
133,261
$
20,611
$
47,906
$
$
$
277,795
Watch
15,880
17,356
3,122
3,416
3,799
3,799
$
5,986
$
49,363
$
36,660
$
133,789
$
20,686
$
55,775
$
$
$
302,366
Pass
$
307,242
$
440,086
$
275,057
$
796,328
$
517,382
$
708,490
$
7,907
$
$
3,052,492
Watch
9,391
9,750
18,744
5,153
24,694
55,619
123,351
23,362
19,146
42,655
8,627
30,379
26,020
18,492
84,247
$
316,633
$
450,565
$
325,790
$
832,007
$
568,096
$
801,747
$
7,907
$
$
3,302,745
$
$
13,356
$
$
$
$
$
$
$
13,576
Pass
$
59,045
$
135,482
$
73,688
$
95,839
$
171,002
$
316,767
$
3,961
$
$
855,784
Watch
2,105
11,092
5,455
29,058
29,571
74,965
1,886
154,132
1,793
16,062
15,956
1,499
36,106
13,441
1,414
39,420
9,189
70,920
14,448
149,183
$
74,591
$
146,925
$
82,350
$
180,379
$
210,558
$
478,687
$
21,794
$
$
1,195,284
$
$
$
$
$
$
$
$
$
Pass
$
932,284
$
666,483
$
775,714
$
489,942
$
205,112
$
359,273
$
1,380,285
$
$
4,809,093
Watch
5,888
98,918
14,605
8,809
3,748
21,330
166,902
320,200
20,525
22,327
9,475
62,104
2,897
15,186
132,989
12,269
12,994
53,950
76,399
158,743
19,757
155,604
489,716
$
970,966
$
800,722
$
853,744
$
637,254
$
368,078
$
403,257
$
1,717,977
$
$
5,751,998
$
$
$
$
$
$
$
6,571
$
$
8,579
Pass
$
18,405
$
119,700
$
77,544
$
9,379
$
2,925
$
10,269
$
49,038
$
$
287,260
Watch
16,615
16,693
$
18,405
$
119,700
$
94,159
$
9,379
$
3,003
$
10,269
$
49,038
$
$
303,953
Pass
$
752,769
$
885,122
$
691,353
$
390,170
$
383,945
$
4,058,832
$
$
$
7,162,191
2,527
2,037
65,123
70,915
$
752,769
$
885,476
$
693,880
$
392,207
$
384,819
$
4,123,955
$
$
$
7,233,106
$
$
$
$
$
$
1,538
$
$
$
1,570
Loans
Loans
Prior
Years
Total
BPPR
Leasing
Pass
$
553,617
$
571,841
$
385,290
$
277,696
$
154,797
$
47,637
$
$
$
1,990,878
1,156
2,254
2,271
1,176
7,706
Loss
$
553,873
$
572,997
$
387,544
$
280,000
$
156,007
$
48,230
$
$
$
$
$
3,244
$
3,717
$
3,778
$
1,284
$
$
$
$
12,543
Pass
$
$
$
$
$
$
$
$
$
25,622
25,622
Loss
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
57,015
$
$
57,015
HELOCs
Pass
$
$
$
$
$
$
$
1,693
$
$
1,693
$
$
$
$
$
$
$
1,693
$
$
1,693
$
$
$
$
$
$
$
$
$
Pass
$
667,332
$
496,053
$
307,971
$
157,341
$
61,363
$
85,216
$
$
29,114
$
1,804,390
2,548
3,519
2,104
6,692
2,213
18,594
Loss
$
668,003
$
498,662
$
311,548
$
159,450
$
62,232
$
91,926
$
$
31,327
$
1,823,148
$
$
12,216
$
26,518
$
14,121
$
3,709
$
1,631
$
$
1,943
$
60,724
Auto
Pass
$
899,264
$
1,068,559
$
762,480
$
513,010
$
357,768
$
191,541
$
$
$
3,792,622
2,250
15,673
14,283
11,662
7,750
6,535
58,153
Loss
$
901,514
$
1,084,249
$
776,866
$
524,709
$
365,518
$
198,097
$
$
$
$
3,122
$
21,282
$
15,163
$
9,159
$
3,657
$
1,266
$
$
$
53,649
Pass
$
28,822
$
25,904
$
23,307
$
16,942
$
8,217
$
3,455
$
63,479
$
$
170,126
Loss
1,025
1,388
$
28,822
$
25,904
$
23,523
$
18,071
$
8,602
$
3,507
$
63,898
$
$
172,327
$
$
$
$
$
$
1,398
$
$
$
2,339
$
4,291,562
$
4,634,563
$
3,586,064
$
3,167,245
$
2,147,599
$
6,215,450
$
3,087,981
$
31,327
$
27,161,791
Loans
Loans
Prior
Years
Total
Pass
$
296,771
$
141,317
$
151,040
$
464,528
$
297,074
$
652,853
$
7,077
$
$
2,010,660
Watch
15,589
24,021
100,470
140,080
7,882
2,503
10,385
1,781
2,736
21,581
26,098
$
296,771
$
141,317
$
152,821
$
490,735
$
321,095
$
777,407
$
7,077
$
$
2,187,223
$
$
$
$
$
$
$
$
$
Pass
$
152,036
$
184,351
$
312,258
$
472,285
$
174,416
$
632,757
$
4,585
$
$
1,932,688
Watch
10,300
8,834
10,841
11,285
52,924
94,184
13,023
7,430
112,510
132,963
$
162,336
$
193,185
$
323,099
$
496,593
$
181,846
$
798,191
$
4,585
$
$
2,159,835
Pass
$
321,250
$
251,751
$
246,753
$
263,185
$
242,063
$
286,643
$
9,556
$
$
1,621,201
Watch
13,500
25,247
7,799
2,284
48,409
1,600
98,839
18,001
11,055
29,056
2,715
54,030
2,308
87,291
146,344
$
321,250
$
285,967
$
272,000
$
325,014
$
246,655
$
433,398
$
11,156
$
$
1,895,440
$
$
$
$
$
$
$
$
$
Pass
$
193,963
$
327,871
$
277,660
$
327,177
$
280,585
$
661,457
$
264,838
$
$
2,333,551
Watch
1,706
9,462
29,796
22,081
63,952
4,295
131,292
4,454
5,993
5,670
4,464
1,457
10,198
22,805
$
193,963
$
335,247
$
292,440
$
361,617
$
303,160
$
727,073
$
280,141
$
$
2,493,641
$
$
1,106
$
$
$
$
$
$
$
1,918
Pass
$
229,225
$
420,979
$
427,419
$
85,358
$
$
6,030
$
12,333
$
$
1,181,344
Watch
5,007
47,416
47,642
6,999
107,805
2,908
2,908
8,602
8,602
$
229,966
$
425,986
$
477,743
$
141,602
$
$
13,029
$
12,333
$
$
Pass
$
94,885
$
84,091
$
85,278
$
207,578
$
262,878
$
562,783
$
$
$
1,297,493
26,948
27,809
$
94,885
$
84,091
$
85,922
$
207,578
$
263,095
$
589,731
$
$
$
1,325,302
Loans
Loans
Prior
Years
Total
HELOCs
Pass
$
$
$
$
$
$
5,580
$
58,047
$
10,311
$
73,938
1,423
2,199
Loss
1,060
$
$
$
$
$
$
7,168
$
58,060
$
11,969
$
77,197
$
$
$
$
$
$
$
$
$
Pass
$
16,107
$
20,115
$
14,538
$
19,843
$
4,249
$
1,384
$
$
$
76,236
Loss
$
16,189
$
20,189
$
14,731
$
20,102
$
4,265
$
1,701
$
$
$
77,177
$
$
1,665
$
1,845
$
3,051
$
$
$
$
$
7,175
Pass
$
$
$
$
$
$
$
8,863
$
$
8,863
$
$
$
$
$
$
$
8,893
$
$
8,893
$
$
$
$
$
$
$
$
$
$
1,315,360
$
1,485,982
$
1,618,756
$
2,043,241
$
1,320,116
$
3,347,698
$
382,245
$
11,969
$
11,525,367
Loans
Loans
Prior
Years
Total
Pass
$
302,538
$
174,800
$
187,700
$
597,789
$
317,685
$
700,759
$
7,184
$
$
2,288,455
Watch
15,880
16,117
24,021
101,418
157,436
7,882
5,625
13,801
1,781
2,736
25,380
29,897
$
302,757
$
190,680
$
189,481
$
624,524
$
341,781
$
833,182
$
7,184
$
$
$
$
$
$
$
$
$
$
$
Pass
$
459,278
$
624,437
$
587,315
$
1,268,613
$
691,798
$
1,341,247
$
12,492
$
$
4,985,180
Watch
19,691
18,584
29,585
16,438
24,694
108,543
217,535
23,362
19,146
42,655
8,627
43,402
33,450
131,002
217,210
$
478,969
$
643,750
$
648,889
$
1,328,600
$
749,942
$
1,599,938
$
12,492
$
$
$
$
13,356
$
$
$
$
$
$
$
13,576
Pass
$
380,295
$
387,233
$
320,441
$
359,024
$
413,065
$
603,410
$
13,517
$
$
2,476,985
Watch
2,105
24,592
30,702
36,857
31,855
123,374
3,486
252,971
18,001
1,793
16,062
27,011
1,499
65,162
13,441
3,066
1,414
93,450
11,497
158,211
14,448
295,527
$
395,841
$
432,892
$
354,350
$
505,393
$
457,213
$
912,085
$
32,950
$
$
$
$
$
$
$
$
$
$
$
Pass
$
1,126,247
$
994,354
$
1,053,374
$
817,119
$
485,697
$
1,020,730
$
1,645,123
$
$
7,142,644
Watch
5,888
100,624
24,067
38,605
25,829
85,282
171,197
451,492
20,525
22,327
13,929
62,284
3,104
15,996
138,982
12,269
18,664
54,814
80,863
158,895
21,214
165,802
512,521
$
1,164,929
$
1,135,969
$
1,146,184
$
998,871
$
671,238
$
1,130,330
$
1,998,118
$
$
$
$
1,438
$
$
$
$
$
6,679
$
$
10,497
Loans
Loans
Prior
Years
Total
Pass
$
247,630
$
540,679
$
504,963
$
94,737
$
2,925
$
16,299
$
61,371
$
$
1,468,604
Watch
5,007
64,031
47,642
6,999
124,498
2,908
2,908
8,602
8,602
$
248,371
$
545,686
$
571,902
$
150,981
$
3,003
$
23,298
$
61,371
$
$
Pass
$
847,654
$
969,213
$
776,631
$
597,748
$
646,823
$
4,621,615
$
$
$
8,459,684
3,171
2,037
1,091
92,071
98,724
$
847,654
$
969,567
$
779,802
$
599,785
$
647,914
$
4,713,686
$
$
$
$
$
$
$
$
$
1,538
$
$
$
1,570
Leasing
Pass
$
553,617
$
571,841
$
385,290
$
277,696
$
154,797
$
47,637
$
$
$
1,990,878
1,156
2,254
2,271
1,176
7,706
Loss
$
553,873
$
572,997
$
387,544
$
280,000
$
156,007
$
48,230
$
$
$
$
$
3,244
$
3,717
$
3,778
$
1,284
$
$
$
$
12,543
Loans
Loans
Prior
Years
Total
Pass
$
$
$
$
$
$
$
$
$
25,622
25,622
Loss
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
57,015
$
$
57,015
HELOCs
Pass
$
$
$
$
$
$
5,580
$
59,740
$
10,311
$
75,631
1,423
2,199
Loss
1,060
$
$
$
$
$
$
7,168
$
59,753
$
11,969
$
78,890
$
$
$
$
$
$
$
$
$
Pass
$
683,439
$
516,168
$
322,509
$
177,184
$
65,612
$
86,600
$
$
29,114
$
1,880,626
2,622
3,690
2,363
6,961
2,213
19,465
Loss
$
684,192
$
518,851
$
326,279
$
179,552
$
66,497
$
93,627
$
$
31,327
$
$
$
13,881
$
28,363
$
17,172
$
4,286
$
1,668
$
$
1,943
$
67,899
Auto
Pass
$
899,264
$
1,068,559
$
762,480
$
513,010
$
357,768
$
191,541
$
$
$
3,792,622
2,250
15,673
14,283
11,662
7,750
6,535
58,153
Loss
$
901,514
$
1,084,249
$
776,866
$
524,709
$
365,518
$
198,097
$
$
$
$
3,122
$
21,282
$
15,163
$
9,159
$
3,657
$
1,266
$
$
$
53,649
Pass
$
28,822
$
25,904
$
23,307
$
16,942
$
8,217
$
3,455
$
72,342
$
$
178,989
Loss
1,025
1,388
$
28,822
$
25,904
$
23,523
$
18,071
$
8,602
$
3,507
$
72,791
$
$
181,220
$
$
$
$
$
$
1,398
$
$
$
2,406
Total Popular Inc.
$
5,606,922
$
6,120,545
$
5,204,820
$
5,210,486
$
3,467,715
$
9,563,148
$
3,470,226
$
43,296
$
Loans
Loans
Prior
Years
Total
BPPR
Pass
$
50,384
$
37,211
$
136,093
$
20,939
$
20,134
$
34,009
$
$
$
298,875
Watch
1,601
2,142
3,161
3,161
3,823
3,823
$
50,384
$
37,211
$
136,634
$
20,939
$
20,134
$
42,594
$
$
$
308,001
Pass
$
419,200
$
322,998
$
828,404
$
547,674
$
335,060
$
525,088
$
6,159
$
$
2,984,583
Watch
26,097
2,296
5,349
28,832
50,924
114,224
7,018
41,274
46,390
95,244
1,002
26,430
1,954
22,956
52,452
$
452,315
$
367,570
$
829,324
$
579,859
$
365,846
$
645,358
$
6,231
$
$
3,246,503
$
$
$
$
$
$
$
$
$
Pass
$
131,449
$
79,109
$
94,008
$
214,520
$
46,206
$
309,791
$
7,214
$
$
882,297
Watch
14,002
2,637
64,735
7,225
4,890
85,580
179,072
1,209
19,436
19,288
15,872
1,499
57,304
1,651
20,528
3,872
140,579
77,098
13,021
257,204
$
145,906
$
84,606
$
198,707
$
244,905
$
191,675
$
488,375
$
21,737
$
$
1,375,911
$
$
$
$
$
$
2,793
$
$
$
2,793
Pass
$
790,273
$
910,355
$
602,454
$
304,227
$
66,395
$
331,493
$
1,495,490
$
$
4,500,687
Watch
124,987
24,935
49,497
6,394
3,465
31,609
135,811
376,698
5,519
7,316
1,895
157,627
30,360
28,171
230,941
6,063
30,496
37,558
4,203
14,776
23,135
122,275
238,506
Loss
$
926,842
$
973,102
$
691,404
$
472,451
$
84,689
$
416,608
$
1,781,798
$
$
5,346,894
$
1,099
$
$
$
$
2,838
$
11,841
$
7,617
$
$
24,555
Pass
$
63,107
$
53,070
$
33,423
$
14,908
$
9,483
$
1,011
$
16,782
$
$
191,784
Watch
13,872
13,872
6,058
6,058
$
63,107
$
66,942
$
33,423
$
21,542
$
9,483
$
1,011
$
16,782
$
$
212,290
Pass
$
879,075
$
724,383
$
409,133
$
401,113
$
234,486
$
4,085,088
$
$
$
6,733,278
1,961
1,331
1,675
71,289
76,603
$
879,075
$
726,344
$
410,464
$
402,788
$
234,833
$
4,156,377
$
$
$
6,809,881
$
$
$
$
$
$
1,067
$
$
$
1,084
Loans
Loans
Prior
Years
Total
BPPR
Leasing
Pass
$
731,053
$
477,226
$
362,426
$
217,537
$
104,812
$
22,762
$
$
$
1,915,816
1,195
2,280
2,834
1,885
9,516
Loss
$
732,248
$
479,506
$
365,260
$
219,422
$
105,732
$
23,237
$
$
$
$
1,733
$
4,842
$
5,373
$
3,281
$
$
1,052
$
$
$
16,975
Pass
$
$
$
$
$
$
$
1,188,093
$
$
1,188,093
29,960
29,960
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
69,731
$
$
69,731
HELOCs
Pass
$
$
$
$
$
$
$
2,040
$
$
2,040
$
$
$
$
$
$
$
2,040
$
$
2,040
$
$
$
$
$
$
$
$
$
Pass
$
722,949
$
499,604
$
262,011
$
101,155
$
29,078
$
91,004
$
$
23,802
$
1,729,603
4,965
3,561
1,221
8,205
1,626
20,773
Loss
$
723,873
$
504,569
$
265,572
$
102,377
$
29,349
$
99,209
$
$
25,428
$
1,750,377
$
2,362
$
39,193
$
38,077
$
10,822
$
2,708
$
3,525
$
$
1,982
$
98,669
Auto
Pass
$
1,277,016
$
938,769
$
665,431
$
494,529
$
254,621
$
133,054
$
$
$
3,763,420
7,239
16,876
13,579
10,775
6,377
5,131
59,977
Loss
$
1,284,269
$
955,660
$
679,010
$
505,306
$
260,998
$
138,194
$
$
$
$
11,229
$
36,992
$
20,486
$
9,997
$
4,965
$
1,731
$
$
$
85,400
Pass
$
28,543
$
29,585
$
20,021
$
10,129
$
4,588
$
3,364
$
62,678
$
$
158,908
Loss
$
28,543
$
29,813
$
20,065
$
10,679
$
4,617
$
3,421
$
63,091
$
$
160,229
$
$
$
$
$
$
2,205
$
$
$
2,801
$
5,286,562
$
4,225,323
$
3,629,863
$
2,580,268
$
1,307,356
$
6,014,384
$
3,109,837
$
25,428
$
26,179,021
Loans
Loans
Prior
Years
Total
Pass
$
139,370
$
148,423
$
491,750
$
313,610
$
207,327
$
560,891
$
5,700
$
$
1,867,071
Watch
10,974
27,441
26,679
10,668
114,419
190,181
8,004
8,004
2,761
23,602
26,363
$
139,370
$
159,397
$
529,956
$
340,289
$
217,995
$
698,912
$
5,700
$
$
2,091,619
$
$
$
$
$
$
$
$
$
Pass
$
178,355
$
368,597
$
480,055
$
167,839
$
193,309
$
456,689
$
8,588
$
$
1,853,432
Watch
12,932
17,125
13,138
45,864
64,390
153,749
2,657
2,741
5,758
97,801
108,957
$
178,355
$
381,529
$
499,837
$
183,718
$
244,931
$
619,474
$
8,888
$
$
2,116,732
$
$
$
$
$
$
$
$
$
Pass
$
304,778
$
257,586
$
244,811
$
279,419
$
35,459
$
246,158
$
7,669
$
$
1,375,880
Watch
25,614
13,531
32,132
16,301
54,877
142,455
69,505
34,428
27,406
10,825
142,652
17,101
2,596
3,678
97,473
120,848
$
304,778
$
283,688
$
344,948
$
348,575
$
82,844
$
409,333
$
7,669
$
$
1,781,835
$
$
$
$
$
$
$
$
$
Loans
Loans
Prior
Years
Total
Pass
$
260,479
$
275,971
$
318,564
$
322,697
$
268,591
$
506,973
$
273,222
$
$
2,226,497
Watch
11,420
48,953
28,138
9,521
35,498
15,050
148,580
5,270
3,835
9,986
2,276
1,610
5,479
9,605
$
262,813
$
287,391
$
372,787
$
351,598
$
278,157
$
544,336
$
297,586
$
$
2,394,668
$
1,103
$
1,571
$
$
$
$
$
$
$
3,978
Pass
$
259,194
$
512,428
$
155,268
$
$
$
$
$
$
927,655
Watch
1,541
36,264
7,172
24,691
69,668
4,897
6,367
11,264
8,104
25,473
9,338
42,915
$
259,194
$
518,866
$
206,003
$
$
$
33,410
$
34,029
$
$
Pass
$
98,345
$
88,788
$
215,600
$
272,908
$
216,025
$
382,746
$
$
$
1,274,412
28,280
29,890
$
98,345
$
89,432
$
215,706
$
273,768
$
216,025
$
411,026
$
$
$
1,304,302
$
$
$
$
$
$
$
$
$
Loans
Loans
Prior
Years
Total
Pass
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
HELOCs
Pass
$
$
$
$
$
$
5,914
$
50,533
$
11,691
$
68,138
1,657
2,372
Loss
1,021
$
$
$
$
$
$
7,693
$
50,548
$
13,290
$
71,531
$
$
$
$
$
$
$
$
$
Pass
$
28,083
$
23,084
$
41,182
$
8,618
$
$
1,507
$
$
$
103,125
1,626
Loss
$
28,293
$
23,493
$
41,809
$
8,757
$
$
1,857
$
$
$
104,867
$
$
4,536
$
10,869
$
2,458
$
$
$
$
$
19,203
Pass
$
$
$
$
$
$
$
11,537
$
$
11,537
$
$
$
$
$
$
$
11,549
$
$
11,549
$
$
$
$
$
$
$
$
$
$
1,271,148
$
1,743,796
$
2,211,046
$
1,506,705
$
1,040,610
$
2,726,041
$
415,995
$
13,290
$
10,928,631
Loans
Loans
Prior
Years
Total
Pass
$
189,754
$
185,634
$
627,843
$
334,549
$
227,461
$
594,900
$
5,805
$
$
2,165,946
Watch
10,974
27,982
26,679
10,668
116,020
192,323
8,004
3,161
11,165
2,761
27,425
30,186
$
189,754
$
196,608
$
666,590
$
361,228
$
238,129
$
741,506
$
5,805
$
$
$
$
$
$
$
$
$
$
$
Pass
$
597,555
$
691,595
$
1,308,459
$
715,513
$
528,369
$
981,777
$
14,747
$
$
4,838,015
Watch
26,097
15,228
17,779
18,487
74,696
115,314
267,973
7,018
41,274
46,984
95,838
1,002
2,767
29,171
7,712
120,757
161,409
$
630,670
$
749,099
$
1,329,161
$
763,577
$
610,777
$
1,264,832
$
15,119
$
$
$
$
$
$
$
$
$
$
$
Pass
$
436,227
$
336,695
$
338,819
$
493,939
$
81,665
$
555,949
$
14,883
$
$
2,258,177
Watch
14,002
28,251
78,266
39,357
21,191
140,457
321,527
1,697
88,941
53,716
27,406
26,697
1,499
199,956
1,651
37,629
6,468
144,257
174,571
13,021
378,052
$
450,684
$
368,294
$
543,655
$
593,480
$
274,519
$
897,708
$
29,406
$
$
$
$
$
$
$
$
2,947
$
$
$
2,947
Pass
$
1,050,752
$
1,186,326
$
921,018
$
626,924
$
334,986
$
838,466
$
1,768,712
$
$
6,727,184
Watch
124,987
36,355
98,450
34,532
12,986
67,107
150,861
525,278
5,577
7,316
7,165
158,195
30,615
32,006
240,927
8,339
30,496
37,558
4,398
14,821
24,745
127,754
248,111
Loss
$
1,189,655
$
1,260,493
$
1,064,191
$
824,049
$
362,846
$
960,944
$
2,079,384
$
$
$
2,202
$
2,278
$
$
$
3,049
$
12,321
$
7,740
$
$
28,533
Loans
Loans
Prior
Years
Total
Pass
$
322,301
$
565,498
$
188,691
$
14,908
$
9,483
$
1,776
$
16,782
$
$
1,119,439
Watch
15,413
36,264
7,172
24,691
83,540
4,897
6,367
6,058
17,322
8,104
25,473
9,338
43,491
$
322,301
$
585,808
$
239,426
$
21,542
$
9,483
$
34,421
$
50,811
$
$
Pass
$
977,420
$
813,171
$
624,733
$
674,021
$
450,511
$
4,467,834
$
$
$
8,007,690
2,605
1,437
2,535
99,569
106,493
$
977,420
$
815,776
$
626,170
$
676,556
$
450,858
$
4,567,403
$
$
$
$
$
$
$
$
$
1,085
$
$
$
1,102
Leasing
Pass
$
731,053
$
477,226
$
362,426
$
217,537
$
104,812
$
22,762
$
$
$
1,915,816
1,195
2,280
2,834
1,885
9,516
Loss
$
732,248
$
479,506
$
365,260
$
219,422
$
105,732
$
23,237
$
$
$
$
1,733
$
4,842
$
5,373
$
3,281
$
$
1,052
$
$
$
16,975
Loans
Loans
Prior
Years
Total
Pass
$
$
$
$
$
$
$
1,188,119
$
$
1,188,119
29,960
29,960
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
69,731
$
$
69,731
HELOCs
Pass
$
$
$
$
$
$
5,914
$
52,573
$
11,691
$
70,178
1,657
2,372
Loss
1,021
$
$
$
$
$
$
7,693
$
52,588
$
13,290
$
73,571
$
$
$
$
$
$
$
$
$
Pass
$
751,032
$
522,688
$
303,193
$
109,773
$
29,729
$
92,511
$
$
23,802
$
1,832,728
1,081
5,364
4,188
1,355
8,507
1,626
22,399
Loss
$
752,166
$
528,062
$
307,381
$
111,134
$
30,007
$
101,066
$
$
25,428
$
$
3,164
$
43,729
$
48,946
$
13,280
$
2,939
$
3,832
$
$
1,982
$
117,872
Auto
Pass
$
1,277,016
$
938,769
$
665,431
$
494,529
$
254,621
$
133,054
$
$
$
3,763,420
7,239
16,876
13,579
10,775
6,377
5,131
59,977
Loss
$
1,284,269
$
955,660
$
679,010
$
505,306
$
260,998
$
138,194
$
$
$
$
11,229
$
36,992
$
20,486
$
9,997
$
4,965
$
1,731
$
$
$
85,400
Pass
$
28,543
$
29,585
$
20,021
$
10,129
$
4,588
$
3,364
$
74,215
$
$
170,445
Loss
$
28,543
$
29,813
$
20,065
$
10,679
$
4,617
$
3,421
$
74,640
$
$
171,778
$
$
$
$
$
$
2,205
$
$
$
2,902
Total Popular Inc.
$
6,557,710
$
5,969,119
$
5,840,909
$
4,086,973
$
2,347,966
$
8,740,425
$
3,525,832
$
38,718
$
Note 9 – Other real estate owned
tables present
the activity
Other Real
Estate Owned
(“OREO”),
for the
quarters and
ended
September 30, 2025 and 2024.
OREO
OREO
Total
$
5,897
$
40,229
$
46,126
(70)
(344)
(414)
8,731
8,883
Sales
(323)
(11,343)
(11,666)
$
5,656
$
37,294
$
42,950
OREO
OREO
Total
$
9,428
$
60,797
$
70,225
(39)
(549)
(588)
1,125
7,966
9,091
Sales
(588)
(15,112)
(15,700)
$
9,926
$
53,102
$
63,028
OREO
OREO
Total
$
8,424
$
48,844
$
57,268
(934)
(2,059)
(2,993)
25,428
26,151
Sales
(2,557)
(34,717)
(37,274)
(202)
(202)
$
5,656
$
37,294
$
42,950
OREO
OREO
Total
$
11,189
$
69,227
$
80,416
(1,103)
(1,260)
(2,363)
6,985
32,748
39,733
Sales
(7,145)
(47,548)
(54,693)
(65)
(65)
$
9,926
$
53,102
$
63,028
Note 10 − Other assets
The caption of other assets in the Consolidated
Statements of Financial Condition consists of the
following major categories:
Net deferred tax assets (net of valuation allowance)
$
837,375
$
926,329
Investments under the equity method
249,139
251,537
Prepaid taxes
54,447
42,909
Other prepaid expenses
34,639
28,376
Capitalized software costs
182,204
136,442
Derivative assets
27,700
25,975
Trades receivable from brokers and counterparties
9,670
Receivables from investments maturities
14,600
Principal, interest and escrow servicing advances
31,226
43,793
Guaranteed mortgage loan claims receivable
10,654
17,226
Operating ROU assets
99,384
93,389
Finance ROU assets
23,706
19,174
Assets for pension benefit
35,137
33,233
Others
148,805
164,188
Total other assets
$
1,744,886
$
1,797,759
The Corporation regularly incurs in
capitalizable costs associated with software development or
licensing which are recorded within
the Other Assets line
item in the accompanying Consolidated Statements
of Financial Condition.
In addition, the Corporation incurs
costs
with
hosting
arrangements
that
are
service
contracts
that
are
also
within
Other
Assets.
The
hosting
arrangements can
include capitalizable
implementation costs
amortized during
the term
of the
hosting arrangement.
The
table
summarizes
the
composition
of
acquired
or
developed
costs
as
well
as
costs
related
to
hosting
arrangements:
Gross Carrying
Net Carrying
Amount
Amortization
Value
Software development costs
$
89,878
$
34,203
$
55,675
Software license costs
59,845
32,476
27,369
110,472
11,312
99,160
Total Capitalized
software costs [1] [2]
$
260,195
$
77,991
$
182,204
Software development costs
$
79,233
$
23,057
$
56,176
Software license costs
42,234
21,459
20,775
65,797
6,306
59,491
Total Capitalized
software costs [1] [2]
$
187,264
$
50,822
$
136,442
[1]
Software intangible assets are presented as part of Other
Assets in the Consolidated Statements of Financial Condition.
[2]
The tables above exclude assets that have been fully
amortized.
Total
amortization expense for
all capitalized software
and hosting arrangement
cost, reflected as
part of
technology and software
expenses in the consolidated statement of operations,
is as follows:
Software development and license costs
$
22,157
$
21,118
$
66,139
$
57,431
2,500
1,514
5,328
3,052
Total amortization
expense
$
24,657
$
22,632
$
71,467
$
60,483
Note 11 – Goodwill and other intangible assets
The following table shows the changes in the carrying
amount of goodwill for the nine months ended
September 30, 2025 and 2024,
by reportable segments (refer to Note 32 for
the definition of the Corporation’s reportable segment):
$
434,909
$
$
434,909
368,045
(13,000)
355,045
Inc.
$
802,954
$
(13,000)
$
789,954
January 1, 2024
$
436,383
$
$
436,383
368,045
368,045
Inc.
$
804,428
$
$
804,428
Other Intangible Assets
The following table reflects the components of
other intangible assets subject to amortization:
Gross Carrying
Net Carrying
Amount
Amortization
Value
Core deposits
$
12,810
$
12,810
$
Other customer relationships
14,286
9,586
4,700
Total other intangible
assets
$
27,096
$
22,396
$
4,700
Core deposits
$
12,810
$
12,595
$
Other customer relationships
14,286
8,435
5,851
Total other intangible
assets
$
27,096
$
21,030
$
6,066
During the
quarter ended
$
0.4
amortization expense
other
intangible assets with definite useful lives (September 30, 2024 - $
0.7
million). During the nine months ended September 30, 2025,
recognized $
1.4
amortization related to
other intangible assets
with definite useful
lives (September 30,
2.2
the estimated
amortization of
the intangible
assets with
definite useful
lives for
each of
the following
periods:
Remaining 2025
$
Year 2026
1,440
Year 2027
Year 2028
Year 2029
Results of the Annual Goodwill Impairment Test
The Corporation’s goodwill and
other identifiable intangible assets having
an indefinite useful life
are tested for impairment,
at least
annually and
on a
more frequent basis
if events
or circumstances indicate
impairment could have
taken place. Such
events could
include,
among others,
a significant
adverse change
in the
business climate,
an adverse
action by
a regulator,
an unanticipated
change in the competitive environment and a decision
to change the operations or dispose of a
reporting unit.
monitors
events
or
changes
in
circumstances
between
annual
tests
to
determine
if
these
events
or
changes
in
circumstances would more likely than not reduce
the fair value of its reporting units below their
carrying amounts.
The reporting units evaluated are one level below the business segments and correspond to the legal entities within each reportable
segment. In accordance with push-down accounting, all
goodwill is assigned to the reporting units
following a business combination.
When
for
impairment,
the
may
decide
to
first
perform
a
qualitative
assessment,
or
“Step
Zero”
impairment test, to determine whether it is more likely than not that impairment has occurred. The qualitative assessment includes a
review of
macroeconomic conditions,
industry and
market considerations,
internal cost
factors, and
our own
overall financial
and
share
price performance,
among other
factors. If
it
is
determined that
it
is more
likely than
not that
amounts
of
our
reporting units exceed their fair value,
the Corporation will perform a quantitative
assessment and calculate the estimated fair value
of
the
unit.
If
the
carrying
amount
of
a
unit’s
exceeds
the
fair
value
of
that
goodwill,
an
impairment loss is recognized.
To
assess
a
reporting unit’s
fair value,
the
Corporation generally
uses
a
combination of
methods
such
as
discounted cash
flow
analysis and market
multiples.
The financial projections used
in the discounted
cash flow (“DCF”)
valuation analysis are
the
most
recent
(as
of
the
valuation
date)
projections
to
the
Asset
/
Liability
Committee
(“ALCO”). These
projections reflect
expectations for
the
reporting unit’s
prospects considering
and industry conditions. The Corporation evaluates the results obtained under the valuation methodology to identify and understand
the
key
value
drivers,
to
ascertain
that
the
results
obtained are
reasonable and
appropriate under
the
circumstances. Elements
considered include current market and
economic conditions, developments in specific lines of
business, and any particular features
of the individual reporting units.
completed its
annual goodwill
impairment evaluation during
2025, using
July 31,
2025 as
the
evaluation date.
Through a
qualitative analysis,
Step
Zero, the
Corporation determined
that for
all
reporting units,
except for
the
Popular Equipment
Finance (‘’PEF’’)
reporting unit,
it is
more-likely-than-not that
value exceeded
value. As
a
result, the Corporation performed a quantitative test
to assess PEF’s goodwill impairment.
The results
of the
PEF annual
goodwill impairment
test as
of July
31, 2025,
indicated that
the estimated
was below
it’s
carrying amount. Accordingly, the Corporation recognized a goodwill impairment
charge of $
13.0
million, which was mainly driven by
lower projected earnings for the forecasted period,
primarily due to lower lending activity.
The following tables present the gross amount
of goodwill and accumulated impairment losses
by reportable segments.
(gross amounts)
losses
(net amounts)
$
438,710
$
3,801
$
434,909
564,456
209,411
355,045
Inc.
$
1,003,166
$
213,212
$
789,954
(gross amounts)
losses
(net amounts)
$
438,710
$
3,801
$
434,909
564,456
196,411
368,045
Inc.
$
1,003,166
$
200,212
$
802,954
Note 12 – Deposits
Total deposits as of the end of the periods presented consisted of:
Savings accounts
$
14,411,671
$
14,224,271
NOW, money market and other interest
-bearing demand deposits
27,606,313
26,507,637
Total savings, NOW,
money market and other interest-bearing demand deposits
42,017,984
40,731,908
Certificates of deposit:
Under $250,000
5,717,369
5,383,331
$250,000 and over
3,904,025
3,629,551
Total certificates
of deposit
9,012,882
Total interest-bearing
$
51,639,378
$
49,744,790
Non- interest-bearing deposits
$
$
$
$
A summary of certificates of deposits by maturity at
September 30, 2025 follows:
$
3,400,879
3,671,826
935,141
697,796
436,147
2030 and thereafter
479,605
Total certificates of
deposit
$
At September 30, 2025, the Corporation had brokered
deposits amounting to $
1.8
billion (December 31, 2024 - $
1.6
The aggregate amount
of overdrafts in
demand deposit accounts that
were reclassified to loans
was $
8.4
million at September
30,
2025 (December 31, 2024 - $
10.4
Puerto Rico government deposits amounted
to $
20.1
billion. Puerto Rico government deposits
are interest
bearing accounts, which are indexed to short-term market
rates and fluctuate in cost with changes in those rates, in accordance
with
contractual terms.
Note 13 – Borrowings
Assets sold under agreements to repurchase amounted
to $
million at September 30, 2025 and $
million at December 31,
repurchase transactions are
overcollateralized with the
securities detailed in
the table
below.
have
a
right
of
set-off
with
the
counterparty
under
the
supplemental
terms
of
the
master
repurchase agreements.
In an
event of
default,
each party
has a
right of
set-off
against the
other party
for amounts
owed in
the
related
agreement
and
any
other
amount
or
obligation
owed
in
respect
of
any
other
agreement
or
transaction
between
them.
Pursuant to the
Corporation’s accounting policy,
the repurchase agreements
are not offset
with other repurchase
agreements held
with the same counterparty.
The following table
presents information related to
the Corporation’s repurchase
transactions accounted for as
secured borrowings
that
are
with
debt
available-for-sale,
debt
held-to-maturity,
and
other
assets
held-for-trading
purposes or
which have
been obtained
under agreements
to resell.
It is
policy to
maintain effective
control over
assets sold under agreements to repurchase; accordingly, such
securities continue to be carried on the Consolidated Statements of
Financial Condition.
Repurchase agreements accounted for as secured borrowings
Repurchase
Repurchase
Within 30 days
$
28,378
$
22,591
After 30 to 90 days
24,065
13,813
52,443
36,404
Within 30 days
4,410
4,924
After 30 to 90 days
13,505
4,410
18,429
Total
$
56,853
$
54,833
Repurchase agreements in this portfolio
are generally short-term, often overnight.
As such our risk
is very limited.
We manage the
liquidity risks arising from secured
funding by sourcing funding globally from
a diverse group of counterparties, providing
a range of
securities collateral and pursuing longer durations,
when appropriate.
At
30,
and
31,
2024,
other
consisted
of
$
million
and
$
respectively, in FHLB Advances.
Notes Payable
The following table presents the composition of notes
payable at September 30, 2025 and December
Advances with the FHLB with maturities ranging from
through
paying interest at
monthly
fixed rates ranging from
0.57
% to
4.17
%
$
195,312
$
302,722
Unsecured senior debt securities maturing on
paying interest
semi-annually
at a fixed rate of
7.25
%, net of debt issuance costs of $
3,751
396,249
395,198
Junior subordinated deferrable interest debentures (related to
trust preferred securities) maturing on
with fixed interest rates ranging from
6.125
% to
6.564
%, net of debt issuance costs of $
198,393
198,373
$
789,954
$
896,293
Note: Refer to the 2024 Form 10-K for rates information
at December 31, 2024.
A breakdown of borrowings by contractual maturities
at September 30, 2025 is included in the table
below.
Assets sold under
Short-term
agreements to
Total
$
56,853
$
400,000
$
30,692
$
487,545
74,500
74,500
6,112
6,112
440,599
440,599
39,658
39,658
Later years
198,393
198,393
Total borrowings
$
56,853
$
400,000
$
789,954
$
1,246,807
At
30,
and
2024,
the
Corporation had
FHLB
borrowing facilities
whereby the
Corporation could
borrow up to
$
4.8
4.7
billion, respectively,
0.6
0.5
billion, respectively,
were used. In
addition, at
December 31, 2024, the Corporation had
placed $
0.3
billion of the available FHLB
credit facility as collateral for municipal
letters of
credit to secure deposits. The FHLB borrowing facilities are collateralized with securities and loans held-in-portfolio,
and do not have
restrictive covenants or callable features.
Also, at September
30, 2025, the Corporation
had borrowing facilities
at the discount
window of the
Federal Reserve Bank of
New
York
amounting to $
11.2
billion (December 31, 2024
- $
7.0
billion), which remained unused
at September 30, 2025
and December
The facilities are a collateralized source of credit
that is highly dependable even under difficult market
conditions.
Note 14 − Other liabilities
The caption of other liabilities in the Consolidated
Statements of Financial Condition consists of the
following major categories:
Accrued expenses
$
332,204
$
334,145
Accrued interest payable
53,682
60,723
Accounts payable
99,649
91,218
Dividends payable
50,376
49,546
Trades payable
306,775
495,139
Liability for GNMA loans sold with an option to repurchase
9,389
9,108
Reserves for loan indemnifications
2,240
2,779
Reserve for operational losses
23,279
29,465
Operating lease liabilities
109,328
103,198
Finance lease liabilities
27,524
23,141
Pension benefit obligation
5,618
5,816
Postretirement benefit obligation
97,828
99,172
Others
72,023
68,396
Total other liabilities
$
1,189,915
$
1,371,846
Note 15 – Stockholders’ equity
As
of
30,
2025,
stockholders’
equity
totaled
$
6.1
During
the
nine
months
ended
30,
2025,
the
Corporation declared cash dividends of $
2.15
1.86
) per common share amounting to $
146.6
million (2024 - $
134.3
The quarterly dividend of $
0.75
per share declared to stockholders of record as
of the close of business on
September 12, 2025
was
paid on
October 1, 2025
.
During the quarter
2024, the Corporation
completed the repurchase
of
599,096
shares of common
stock for
$
58.8
an average price
of $
98.11
under the 2024
repurchase program. During
and
nine months ended
September 30, 2025,
the Corporation repurchased
shares of common
stock for $
119.4
million at an
average price of
$
119.33
per share, and
3,407,821
shares of common stock
for $
353.7
million at an
average price of $
103.78
, per
share, respectively,
as part of the
2024 and 2025 common
stock repurchases programs. As
of September 30, 2025,
$
429.0
million
remained available for stock repurchase under
the active repurchase authorization.
Note 16 – Other comprehensive income (loss)
accumulated other comprehensive
income (loss)
by component
for the
quarters and
nine
months ended September 30, 2025 and 2024.
Changes in Accumulated Other Comprehensive Loss
by Component [1]
Foreign currency translation
$
(70,512)
$
(68,383)
$
(71,365)
$
(64,528)
Other comprehensive (loss) income
(3,240)
(3,240)
$
(85,036)
$
(67,768)
$
(85,035)
$
(67,768)
Adjustment of pension and
$
(91,851)
$
(113,371)
$
(94,692)
$
(117,894)
Amounts reclassified from accumulated other
comprehensive loss for amortization of net losses
1,421
2,261
4,262
6,784
1,421
2,261
4,262
6,784
$
(90,430)
$
(111,110)
$
(90,430)
$
(111,110)
Unrealized net holding losses
on debt securities
$
(1,233,294)
$
(1,696,528)
$
(1,495,183)
$
(1,713,109)
Other comprehensive income
94,747
326,148
283,394
271,985
Amounts reclassified from accumulated other
comprehensive loss for amortization of net unrealized
losses of debt securities transferred from available-for-
37,753
36,264
110,994
107,008
132,500
362,412
394,388
378,993
$
(1,100,794)
$
(1,334,116)
$
(1,100,795)
$
(1,334,116)
Total accumulated
other comprehensive loss
$
$
$
$
[1]
All amounts presented are net of tax.
the amounts
reclassified out
of each
component of
accumulated other
comprehensive income
(loss)
during the quarters and nine months ended September
30, 2025 and 2024.
Reclassifications Out of Accumulated Other Comprehensive
Loss
Affected Line Item in the
Consolidated Statements of Operations
Adjustment of pension and postretirement benefit plans
Amortization of net losses
$
(2,272)
$
(3,618)
$
(6,817)
$
(10,854)
Total before tax
(2,272)
(3,618)
(6,817)
(10,854)
Income tax benefit
1,357
2,555
4,070
Total net of tax
$
(1,421)
$
(2,261)
$
(4,262)
$
(6,784)
Unrealized net holding losses on debt securities
Amortization of unrealized net losses of debt
securities transferred to held-to-maturity
Interest income from investment securities
$
(47,191)
$
(45,331)
$
(138,743)
$
(133,761)
Total before tax
(47,191)
(45,331)
(138,743)
(133,761)
9,438
9,067
27,749
26,753
Total net of tax
$
(37,753)
$
(36,264)
$
(110,994)
$
(107,008)
Total reclassification
adjustments, net of tax
$
(39,174)
$
(38,525)
$
(115,256)
$
(113,792)
Note 17 – Guarantees
has obligations
occurrence of
certain events
under financial
guarantees provided
in certain
Also,
from
time
to
time,
the
securitized
loans
into
subject, in certain instances, to lifetime credit recourse
on the loans that serve as collateral for
the mortgage-backed securities. The
Corporation has
not sold
any mortgage
loans subject
to credit
recourse since
- Also,
from time
to time,
may
sell, in
bulk sale
transactions, residential
mortgage loans
and Small
Business Administration
(“SBA”) commercial
loans subject
to
credit
or
to
certain
representations
and
warranties
from
the
to
the
purchaser.
These
representations
and
warranties may
relate, for
example, to
borrower creditworthiness,
loan documentation,
collateral,
prepayment and
early payment
defaults. The
Corporation may
be required
to
repurchase the
loans under
the credit
recourse agreements
or
representation and
warranties
serviced $
million (December
- $
million) in
residential mortgage
loans
credit recourse
provisions, principally loans
associated with
FNMA and
FHLMC residential
mortgage loan
securitization
programs. In the event
of any customer default, pursuant to
the credit recourse provided, the
Corporation is required to repurchase
the loan or reimburse the
third-party investor for the loss
incurred. During the quarter and
nine months ended September 30,
2025,
the Corporation repurchased $
0.2
1.1
million, respectively, of unpaid principal balance in mortgage loans subject
to the
credit
provisions
30,
$
0.5
million
and
$
1.5
respectively).
At
30,
2025,
the
Corporation’s liability
established to cover
the estimated credit
loss exposure
related to loans
sold or serviced
with credit
amounted to $
From
time
to
time, the
Corporation sells
loans and
agrees to
indemnify the
purchaser for
credit
losses
or
any
breach
of
certain
representations and warranties made in connection
with the sale.
Servicing agreements
relating to
the mortgage-backed
securities programs
of FNMA,
FHLMC and
GNMA, and
to mortgage
loans
sold or serviced to certain other investors, including FHLMC,
require the Corporation to advance funds to
make scheduled payments
of principal, interest, taxes and insurance, if such payments have not
been received from the borrowers. At September 30, 2025, the
Corporation serviced $
8.4
billion in mortgage loans for third parties, including the loans serviced with credit recourse (December 31,
9.0
billion). The Corporation generally recovers funds advanced pursuant to these arrangements from
the mortgage owner,
from liquidation proceeds when the mortgage
loan is foreclosed or,
in the case of FHA/VA
loans, under the applicable FHA
and
VA
and guarantees
programs. However,
in the
meantime, the
Corporation must
absorb the
cost
of the
funds
it
time the
advance is
outstanding. The
Corporation must
also bear
the costs
of attempting
to collect
on delinquent
and
defaulted
loans.
In
if
a
defaulted
loan
is
not
cured,
the
loan
would
be
canceled
as
part
of
the
foreclosure proceedings and the Corporation would
not receive any future servicing income
with respect to that loan. At
30, 2025, the outstanding
balance of funds advanced by
the Corporation under such
mortgage loan servicing agreements was
$
million
(December
31,
$
To
the
extent
the
loans
the
experience
increased delinquencies,
the
Corporation would
be
required to
dedicate
additional cash
resources to
comply
with its
obligation to advance funds as well as incur additional
administrative costs related to increases in collection
efforts.
Inc. Holding
Company (“PIHC”) fully
and unconditionally guarantees
certain borrowing
obligations issued by
certain of
its
% owned
consolidated subsidiaries
amounting to
$
2024, respectively.
In
addition, at both
September 30, 2025 and
December 31, 2024, PIHC
fully and unconditionally guaranteed
on a subordinated basis
$
million of capital securities (trust preferred securities) issued by wholly-owned issuing trust entities to the extent set forth in the
agreement.
Refer
to
Note
to
the
in
the
Form
10-K
for
further
information on the trust preferred securities.
Note 18 – Commitments and contingencies
Off-balance sheet risk
is a
party to
financial instruments
with off-balance
sheet credit
risk in
the normal
course of
business to
meet the
financial needs of its customers. These financial instruments
include loan commitments, letters of credit and standby
letters of credit.
These instruments involve,
to varying
degrees, elements of
credit and
interest rate
risk in
excess of
the amount
recognized in
the
Consolidated Statements of Financial Condition.
The
to
credit
loss
in
the
event
of
nonperformance
by
the
other
party
to
the
instrument
for
commitments to extend credit, standby
letters of credit and financial
guarantees is represented by the
contractual notional amounts
of those instruments. The
Corporation uses the same
credit policies in
making these commitments and conditional
obligations as it
does for those reflected on the Consolidated Statements
of Financial Condition.
Financial instruments with
off-balance sheet credit
risk, whose contract
amounts represent potential credit
risk as of
the end of
the
periods presented were as follows:
Commitments to extend credit:
Credit card lines
$
6,266,974
$
5,599,823
Commercial lines of credit
4,422,977
3,971,331
Construction lines of credit
1,126,310
1,131,824
Other consumer unused credit commitments
275,462
260,121
Commercial letters of credit
14,920
5,002
Standby letters of credit
130,856
144,845
Commitments to originate or fund mortgage loans
16,091
29,604
and December 31, 2024,
the Corporation maintained a
reserve of $
million, respectively,
for potential losses associated with unfunded loan
commitments related to commercial and construction
lines of credit.
Other commitments
At
30,
and
2024,
the
also
maintained
other
non-credit
commitments
for
$
primarily for the acquisition of other investments.
Business concentration
Since the Corporation’s business activities are concentrated primarily in Puerto Rico, its results of operations and financial condition
are dependent
general trends
of the
economy and,
in particular,
the residential
and commercial
markets. The concentration
of the Corporation’s
operations in Puerto Rico
exposes it to
greater risk than other
banking companies
with a wider geographic base. Its
asset and revenue composition by geographical area
is presented in Note 28
to the Consolidated
Puerto
Rico
has
faced
fiscal
and
challenges
for
over
a
decade.
In
to
such
challenges,
the
U.S.
Congress
enacted
PROMESA
in
2016,
which,
among
other
things,
the
Board
and
a
framework
for
the
of
the
debts
of
the
Commonwealth,
its
and
municipalities.
The
Commonwealth
and
several
of
its
instrumentalities have
availed themselves
of debt
restructuring proceedings
under PROMESA.
As of
the date
of this
report, while
municipalities have been designated as covered entities under PROMESA, no municipality has commenced or has been authorized
by the Oversight Board to commence, any such debt
restructuring proceeding under PROMESA.
At September 30, 2025, the Corporation’s direct exposure to the Puerto Rico government and its instrumentalities and municipalities
totaled
$
of
which
$
million
were
($
million
and
$
million
at
31,
2024).
The
at
30,
2025,
up
to
$
47.4
million
in
Automated
Clearing
House
(“ACH”)
transaction
settlement exposure, none
of which was
outstanding. Of the
amount outstanding, $
million consists of
loans and $
million are
securities ($
million at December
31, 2024). Substantially all
of the amount
outstanding at September 30,
and December 31, 2024 were obligations from various Puerto Rico
municipalities. In most cases, these were “general obligations” of
a
municipality,
to
which
the
has
pledged
its
good
faith,
credit
and
unlimited
taxing
power,
or
“special
obligations”
of
a
municipality,
to
which
the
has
pledged
other
revenues.
At
30,
2025,
% of
exposure to
municipal loans
and securities
was concentrated
in the
San
Juan, Guaynabo, Carolina and Caguas.
The following table details the loans and investments representing the Corporation’s direct exposure to
the Puerto Rico government
according to their maturities as of September 30, 2025
:
Investment
Portfolio
Loans
Total Outstanding
Total Exposure
Central Government
$
$
$
$
47,400
Total Central
47,441
Municipalities
2,605
11,574
14,179
16,179
5,660
166,515
172,175
172,175
124,087
124,537
124,537
30,991
30,991
30,991
Total Municipalities
8,715
333,167
341,882
343,882
Total Direct Government
Exposure
$
8,756
$
333,167
$
341,923
$
391,323
In
at
30,
2025,
the
had
$
million
in
loans
insured
or
issued
by
Puerto
Rico
governmental entities
but for
which the
principal source
of repayment
is non-governmental
($
2024).
These
$
million
in
residential
loans
insured
by
the
Puerto
Rico
Housing
Finance
Authority
(“HFA”),
a
governmental instrumentality that
has been
designated as a
covered entity under
PROMESA (December 31,
2024 -
$
These mortgage loans are secured by first mortgages on Puerto Rico residential properties and the HFA
insurance covers losses in
of a
borrower default
and upon
the satisfaction
of certain
other conditions.
also had
30,
2025, $
million in bonds
issued by HFA
which are secured by
second mortgage loans on
Puerto Rico residential properties,
and
for which HFA
also provides insurance to
cover losses in
the event of
a borrower default
and upon the
satisfaction of certain
other
conditions (December
- $
million). In
that the
mortgage loans
insured by
HFA
and held
by the
directly or those serving as collateral for the HFA
bonds default and the collateral is insufficient to satisfy the
outstanding balance of
these loans, HFA’s
ability to honor its insurance will depend, among other factors, on the financial condition of HFA
at the time such
become
due
and
payable. The
Corporation does
not consider
the
government guarantee
when
estimating the
credit
losses
with
this
portfolio.
Although
the
Governor
is
authorized
by
local
legislation
to
impose
a
temporary
moratorium on the financial obligations of the HFA, a moratorium on
such obligations has not been imposed as of
the date hereof.
commercial loan
portfolio also
includes loans
to
private borrowers
who
are service
providers, lessors,
suppliers or
have
other relationships with the government. These
borrowers could be negatively affected by
the Commonwealth’s fiscal crisis and
the
ongoing
Title
III
under
PROMESA.
Similarly,
and
loan
include
loans
to
employees
and
retirees,
which
could
also
be
negatively
affected
by
fiscal
such
as
employee
layoffs
or
furloughs or reductions in pension benefits.
In
$
2.4
billion
of
residential
mortgages
and
$
80.9
million
loans
were
insured
or
by
the
U.S.
or
its
at
30,
(compared
to
$
2.1
billion
and
$
87.4
at
31,
2024). The
Corporation also had
and obligations from
the U.S. Government,
its agencies or
government sponsored
within the
portfolio of
available-for-sale and
held-to-maturity securities
as
described in
Note 5
and
6 to
the Consolidated
At September 30, 2025, the Corporation had operations in the United States Virgin Islands (the “USVI”) and had $
million in direct
exposure to USVI government
entities (December 31, 2024
- $
million). The USVI has
been experiencing a number of
fiscal and
economic challenges that could adversely affect the ability
of its public corporations and instrumentalities
to service their outstanding
debt
PROMESA
does
not
apply
to
the
USVI
and,
as
such,
there
is
no
federal
legislation
permitting
the
restructuring of the debts of the USVI and
its public corporations and instrumentalities.
the Corporation had operations
in the British Virgin
Islands (“BVI”) and it
had a loan portfolio
amounting to
$
million comprised of various retail and commercial
clients, compared to a loan portfolio
of $
million at December 31, 2024.
At September 30, 2025, the Corporation had
no
significant exposure to a single borrower in the BVI.
FDIC Special Assessment
On
November 16,
2023, the
Federal Deposit
Insurance Corporation
(“FDIC”)
imposed a
special
assessment (the
“FDIC Special
Assessment”) amount to
recover the losses
to the
deposit insurance fund
resulting from the
FDIC’s funds
used, in March
2023, in
connection with the systemic risk exception, to the least-cost resolution
test, under the Federal Deposit Insurance Act to manage the
receiverships of several failed banks. In connection with this assessment, the Corporation accrued $
71.4
million, $
45.3
million net of
tax, in the fourth quarter of 2023, representing
the full amount of the assessment.
During the first quarter of 2024, the Corporation recorded an additional expense of $
14.3
million, $
9.1
million net of tax, to reflect the
FDIC's higher loss estimate communicated
by the FDIC. The
special assessment amount and collection
period may change as
the
estimated loss is
periodically adjusted or
if the total
amount collected varies.
The last payment
for the FDIC
special assessment is
projected to be in the third quarter, September 2026.
Legal Proceedings
The nature of Popular’s
business ordinarily generates claims, litigation, arbitration,
regulatory and governmental investigations, and
legal
and
administrative
cases
and
(collectively,
“Legal
Proceedings”).
Popular’s
Legal
may
involve
various lines
and include
claims relating
to contract,
torts, consumer
protection, securities,
antitrust, employment,
tax
and
other
laws.
The
recovery
sought
in
Legal
may
include
substantial
or
indeterminate
compensatory
damages,
punitive
damages,
injunctive
relief,
or
recovery
on
a
class-wide
basis.
When
the
determines
that
it
has
meritorious
defenses to the claims
asserted, it vigorously defends
itself. The Corporation will
consider the settlement of
cases (including cases
where it has meritorious defenses) when, in management’s judgment,
it is in the best interest of the Corporation and
its stockholders
to do so.
On at least
a quarterly basis,
Popular assesses its
liabilities and contingencies
relating to outstanding Legal
utilizing the most current information available. For
matters where it is probable that the Corporation will
incur a material loss and the
amount can be reasonably estimated, the Corporation establishes an accrual for
the loss. Once established, the accrual is
adjusted
on at least a quarterly basis to reflect any relevant
developments, as appropriate. For matters where a material loss is not probable,
or the amount of the loss cannot be reasonably
estimated, no accrual is established.
In certain cases,
exposure to loss
exists in
excess of any
accrual to the
extent such loss
is reasonably possible,
but not
probable.
Management believes and
estimates that the
range of reasonably
possible losses (with
respect to those
matters where such
limits
may be determined in excess of amounts accrued) for current Legal Proceedings ranged from $
to approximately $
7.2
million as of
30,
In
certain
cases,
cannot
reasonably
the
possible
loss
at
this
time.
Any
involves significant judgment, given the
varying stages of the
Legal Proceedings (including the fact
that many of them
are currently
in preliminary stages), the
existence of multiple
defendants in several of
the current Legal Proceedings
whose share of liability
has
yet to be determined, the numerous unresolved issues in
many of the Legal Proceedings, and the inherent uncertainty
of the various
potential
outcomes
of
such
Legal
Proceedings.
Accordingly,
will
change
from
time-to-time,
and
actual
losses may be more or less than the current estimate.
While the
outcome of
Legal Proceedings
is inherently
uncertain, based
on information
currently available,
advice of
counsel, and
coverage,
believes
that
the
amount
it
has
already
accrued
is
adequate
and
any
incremental
liability arising from
the Legal Proceedings
in matters in
which a loss
amount can be
reasonably estimated will not
have a material
adverse effect
on the Corporation’s
consolidated financial position.
However, in
of unexpected future
developments, it is
possible that
the ultimate
resolution of
these matters
in a
reporting period, if
unfavorable, could have
a material
adverse effect
on
the Corporation’s consolidated financial position for that period.
Note 19 – Non-consolidated variable interest
The Corporation is involved with
two
statutory trusts which it created to issue trust preferred securities to the public. These
trusts are
deemed to
be variable
interest entities
(“VIEs”) since
the equity
investors at
risk have
no substantial
decision-making rights.
The
Corporation does not
hold any variable
interest in the
trusts, and therefore,
cannot be the
trusts’ primary beneficiary.
Furthermore,
the
Corporation concluded
that
it did
not
hold
a
controlling financial
in
these
trusts
since the
decisions
of
the
trusts
are
predetermined through
the trust
documents and the
guarantee of
the trust
preferred securities is
irrelevant since
in substance
the
sponsor is guaranteeing its own debt.
Also, the
Corporation is
involved with
various special
purpose entities
mainly in
guaranteed mortgage
securitization transactions,
GNMA
and
FNMA.
The
has
also
engaged
in
securitization
with
FHLMC,
but
considers
its
exposure in the
form of servicing
fees and servicing
advances not to be
at September 30,
.
These special purpose
are
deemed
to
be
VIEs
since
they
lack
equity
at
risk.
The
continuing
involvement
in
these
guaranteed loan
securitizations includes
owning certain
beneficial interests in
the form
of securities as
well as
rights
retained. The Corporation is not required to provide additional financial support to
any of the variable interest entities to which it has
transferred
the
assets.
The
to
the
extent
retained,
are
in
the
of
Condition
as
or
trading
securities.
The
concluded
that,
essentially,
these
(FNMA
and
GNMA)
control
the
design
of
their
VIEs,
dictate
the
quality
and
nature
of
the
collateral, require
the underlying
insurance, set
standards via
guides and
can change
them at
will, and
can remove a
primary servicer with cause,
and without cause in
the case of
FNMA. Moreover, through
their guarantee obligations,
agencies (FNMA and GNMA) have the obligation
to absorb losses that could be potentially significant
to the VIE.
The
holds
interests
in
these
VIEs
in
the
form
of
agency
and
mortgage obligations, including those securities originated by the Corporation and those acquired from
third parties. Additionally, the
Corporation holds agency mortgage-backed securities
and agency collateralized mortgage obligations
issued by third party
VIEs in
which
it
has
no
other
form
of
continuing
involvement. Refer
to
Note
to
the
for
information on the debt securities outstanding at September 30, 2025 and December 31, 2024, which are classified as available-for-
sale and
trading securities
in the
Corporation’s Consolidated
Statements of
Financial Condition. In
addition, the
Corporation holds
interests
in
the
form
of
fees,
since
it
retains
the
right
to
service
the
transferred
loans
in
those
government-
sponsored special purpose entities (“SPEs”) and may also purchase the right to service loans in other government-sponsored SPEs
that were transferred to those SPEs by a third-party.
amount and
classification of
the assets
variable interests
in
non-consolidated VIEs
and the
maximum exposure
to loss
as a
involvement as
servicer of
GNMA and
FNMA loans at September 30, 2025 and
Assets
Servicing assets:
$
76,673
$
84,356
Total servicing
assets
$
76,673
$
84,356
Other assets:
Servicing advances
$
4,017
$
6,112
Total other assets
$
4,017
$
6,112
$
80,690
$
90,468
Maximum exposure to loss
$
80,690
$
90,468
The size of
the non-consolidated VIEs,
in which the
Corporation has a
variable interest in
the form
of servicing fees,
measured as
the total unpaid principal balance of the loans, amounted
to $
6.1
billion at September 30, 2025 (December 31, 2024 -
$
6.6
determined that
the maximum
exposure to
loss includes
the MSRs
and the
assumption that
the
at
and
2024,
will
not
be
recovered.
The
agency
are
not
included as part of the maximum exposure to loss
since they are guaranteed by the related agencies.
ASU 2009-17 requires that an ongoing primary beneficiary assessment should be made to determine whether the Corporation is the
primary beneficiary of any of the VIEs it is
involved with. The conclusion on the assessment of these non-consolidated VIEs has not
changed
since
their
initial
evaluation.
The
concluded
that
it
is
still
not
the
primary
beneficiary
of
these
VIEs,
and
therefore, these VIEs are not required to be consolidated
in the Corporation’s financial statements at September 30,
Note 20 – Related party transactions
Centro Financiero BHD, S.A.
had a
15.63
% equity
interest in
Centro Financiero BHD,
S.A. (“BHD”),
one of
the largest
banking
and
groups
in
the
Dominican
Republic.
During
the
nine
months
ended
30,
2025,
the
Corporation recorded $
17.0
equity pickup (September
- $
29.6
million), including the
net impact
of $
33.8
million
from net
earnings (September
- $
31.5
million), offset
by ($
16.8
) million
recorded through
Other Comprehensive
Income
(September 30, 2024
- ($
1.9
) million) related
to foreign currency
translation adjustments and
changes in the
of available
for sale
securities. At September
the investment
in BHD had
a carrying
$
236.5
million (December
31, 2024 -
$
239.5
million) and the Corporation received $
million in cash dividend distributions during the nine months ended September 30,
2025 (September 30, 2024 - $
19.4
Note 21 – Fair value measurement
ASC Subtopic
820-10 “Fair
Value
Measurements and
Disclosures” establishes
a fair
value hierarchy
that prioritizes
the inputs
to
valuation techniques
used to
measure fair
value into
three levels
in order
to increase
consistency and
comparability in
measurements and disclosures. The hierarchy is broken
down into three levels based on the reliability
of inputs as follows:
Level
- Unadjusted
quoted prices
in
active markets
for identical
assets
or liabilities
that
has the
ability to
access at the
measurement date. Valuation
on these instruments
does not necessitate a
significant degree of judgment
since
valuations are based on quoted prices that are
readily available in an active market.
Level 2
- Quoted
prices other
than those
Level 1
observable either
directly or
indirectly.
Level 2
inputs
include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in
markets
that
are
not
active,
or
other inputs
that
are
observable
or that
can
be
corroborated by
observable market
data
for
substantially the full term of the financial instrument.
Level 3
- Inputs are unobservable and significant
to the fair value measurement.
Unobservable inputs reflect the Corporation’s
own judgements about assumptions that market participants
would use in pricing the asset or liability.
The
maximizes
the
use
of
observable
inputs
and
minimizes
the
use
of
unobservable
inputs
by
that
the
observable inputs be used when
available. Fair value is
based upon quoted market prices
when available. If listed prices
or quotes
are
not
available,
the
employs
internally-developed
models
that
use
market-based
inputs
yield
curves, interest rates,
volatilities, and credit
curves, among others.
Valuation
adjustments are limited
to those necessary
to ensure
that the financial instrument’s
fair value is adequately representative of
the price that would
be received or paid
in the marketplace.
These adjustments include amounts that reflect counterparty credit quality,
the Corporation’s credit standing, constraints on liquidity
and unobservable parameters that are applied consistently.
There have been no changes in the
Corporation’s methodologies used
to estimate the fair value of assets and liabilities from
those disclosed in the 2024 Form 10-K.
The estimated fair
value may
be subjective in
nature and may
involve uncertainties and
matters of
significant judgment for
certain
financial instruments. Changes in the underlying assumptions
used in calculating fair value could significantly
affect the results.
Fair Value on a Recurring and Nonrecurring Basis
The following fair value hierarchy tables
present information about the Corporation’s assets
and liabilities measured at fair value
on
a recurring basis at September 30, 2025 and December
31, 2024:
Level 1
Level 2
Level 3
Measured at NAV
Total
RECURRING FAIR VALUE
Assets
Debt securities available-for-sale:
$
$
9,283,519
$
$
$
15,706,765
104,700
104,700
4,873,777
4,874,208
Other
$
$
14,261,996
$
1,181
$
$
derivatives:
$
8,026
$
$
$
$
8,036
Collateralized mortgage obligations
24,227
24,311
Other
Total trading account
debt securities, excluding
$
8,026
$
24,878
$
$
$
33,106
$
$
50,047
$
$
$
50,872
99,523
99,523
4,785
4,785
27,716
27,716
$
6,431,272
$
14,369,422
$
100,906
$
$
20,902,425
$
$
$
$
$
Total liabilities measured
$
$
$
$
$
Level 1
Level 2
Level 3
Measured at NAV
Total
RECURRING FAIR VALUE
Assets
Debt securities available-for-sale:
$
$
5,482,939
$
$
$
12,995,110
120,284
120,284
5,127,775
5,128,259
Other
2,250
2,250
$
$
10,730,998
$
2,734
$
$
derivatives:
$
2,814
$
$
$
$
2,824
Collateralized mortgage obligations
29,032
29,116
Other
Total trading account
debt securities, excluding
$
2,814
$
29,752
$
$
$
32,783
$
$
45,664
$
$
$
46,045
108,103
108,103
5,423
5,423
26,023
26,023
$
7,514,985
$
10,837,860
$
111,054
$
$
18,464,280
$
$
$
$
$
Total liabilities measured
$
$
$
$
$
Loans held-for-sale measured at fair value
Loans held-for-sale measured at fair value were priced
based on secondary market prices. These loans
are classified as Level 2.
The
tables summarize
the difference
between the
aggregate fair
value
and the
aggregate unpaid
balance
for
mortgage loans originated as held-for-sale measured
at fair value as of September 30, 2025 and
Aggregate Unpaid
Fair Value
Principal Balance
Difference
Loans held for sale
$
4,785
$
4,715
$
Aggregate Unpaid
Fair Value
Principal Balance
Difference
Loans held for sale
$
5,423
$
5,436
$
(13)
No
loans held-for-sale were 90 or more days past
due or on nonaccrual status as of September 30,
2025 and December 31, 2024.
The fair value information included in the following tables is
not as of period end, but as of
the date that the fair value measurement
was recorded during the
nine months ended September 30,
2025 and 2024 and
excludes nonrecurring fair value measurements of
assets no longer outstanding as of the reporting
date.
Level 1
Level 2
Level 3
Total
NONRECURRING FAIR VALUE
Assets
Write-downs
[1]
$
$
$
3,983
$
3,983
$
(1,351)
Other foreclosed assets
[1]
(51)
at fair value on a nonrecurring basis
$
$
$
4,179
$
4,179
$
(1,402)
[1] Represents the fair value of foreclosed real estate and
other collateral owned that were written down to their fair
value. Costs to sell are
Level 1
Level 2
Level 3
Total
NONRECURRING FAIR VALUE
Assets
Write-downs
Loans
[1]
$
$
$
4,166
$
4,166
$
(654)
[2]
5,749
5,749
(1,889)
Other foreclosed assets
[2]
(38)
at fair value on a nonrecurring basis
$
$
$
10,089
$
10,089
$
(2,581)
[1] Relates mainly to certain impaired collateral dependent loans.
The impairment was measured based on the fair value
of the collateral, which is
derived from appraisals that take into consideration prices
in observed transactions involving similar assets in similar
locations. Costs to sell are
[2] Represents the fair value of foreclosed real estate and
other collateral owned that were written down to their fair
value. Costs to sell are
The following tables present the changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the quarters
and nine months ended September 30, 2025 and
Quarter ended September 30, 2025
MBS
Other
MBS
Other
as debt
account
debt
Total
rights
assets
Balance at June 30, 2025
$
$
$
$
$
103,077
$
104,465
(4)
(3,835)
(3,839)
(1)
(1)
$
$
$
$
$
99,523
$
100,906
$
$
$
$
$
(1,505)
$
(1,505)
MBS
Other
MBS
Other
as debt
account
debt
Total
rights
assets
Balance at January 1, 2025
$
$
2,250
$
$
$
108,103
$
111,054
(15)
(9,359)
(9,374)
(3)
(3)
(50)
(50)
Transfers out of Level 3
(1,500)
(1,500)
$
$
$
$
$
99,523
$
100,906
$
$
$
$
$
(2,482)
$
(2,459)
Quarter ended September 30, 2024
MBS
Other
Other
MBS
as debt
Total
rights
assets
Balance at June 30, 2024
$
$
2,000
$
$
$
113,386
$
116,209
(4)
(4,896)
(4,900)
(25)
(25)
$
$
2,000
$
$
$
108,827
$
111,623
$
$
$
$
$
(2,577)
$
(2,571)
MBS
Other
Other
CMOs
as debt
MBS
trading account
Total
rights
assets
Balance at January 1,
$
$
2,500
$
$
$
$
118,109
$
121,499
(500)
(13)
(10,280)
(10,793)
(50)
(5)
(28)
(83)
$
$
2,000
$
$
$
$
108,827
$
111,623
Changes in unrealized gains (losses)
included in earnings relating to assets
still held at September 30, 2024
$
$
$
$
$
$
(3,279)
$
(3,261)
Gains and losses
(realized and unrealized)
included in earnings
for the
quarters
2024 for
Level 3 assets
and liabilities included
in the
previous tables are
reported in the
Consolidated Statement of
Operations as
follows:
Quarter ended September 30, 2025
$
(3,835)
$
(1,505)
$
(9,359)
$
(2,482)
Trading account profit (loss)
(4)
(15)
Total
$
(3,839)
$
(1,505)
$
(9,374)
$
(2,459)
Quarter ended September 30, 2024
$
(4,896)
$
(2,577)
$
(10,280)
$
(3,279)
Trading account profit (loss)
(4)
(13)
(500)
Total
$
(4,900)
$
(2,571)
$
(10,793)
$
(3,261)
tables include
quantitative information
about significant
unobservable inputs
used to
derive the
of Level
instruments, excluding those instruments
for which the
unobservable inputs were not
developed by the
Corporation such as
prices
of prior transactions and/or unadjusted third-party pricing
sources at September 30, 2025 and 2024.
Fair value at
Valuation technique
Unobservable inputs
Weighted average (range) [1]
Other - trading
$
Discounted cash flow model
Weighted average life
years
Yield
.0%
Prepayment speed
10.8
%
$
[2]
%
[1]
Weighted average of significant unobservable inputs
used to develop Level 3 fair value measurements
were calculated by relative fair value.
[2]
Other real estate owned in which haircuts were not applied
Fair value at
Valuation technique
Unobservable inputs
Weighted average (range) [1]
Other - trading
$
Discounted cash flow model
Weighted average life
2.3
years
Yield
.0%
Prepayment speed
10.8
%
$
4,166
[2]
7.5
% (
.0% -
.0%)
$
[3]
.0%
[1]
Weighted average of significant unobservable inputs
used to develop Level 3 fair value measurements
were calculated by relative fair value.
[2]
Loans held-in-portfolio in which haircuts were not applied
[3]
Other real estate owned in which haircuts were not applied
Note 22 – Fair value of financial instruments
The fair
financial instruments
is the
amount at
which an
asset or
obligation could
be exchanged
in a
current transaction
between
willing
parties,
other
than
in
a
forced
or
liquidation
sale.
For
those
instruments
with
no
quoted
market
prices
available, fair values have been estimated using present
value calculations or other valuation techniques, as well
as management’s
best judgment with respect to current economic conditions, including discount rates, estimates of future cash flows, and prepayment
assumptions. Many of these
estimates involve various assumptions and
may vary significantly from
amounts that could be
realized
in actual transactions.
The
fair
values
herein
have
been
determined
based
on
the
prevailing
rate
environment
at
30,
and
December 31, 2024, as
applicable. In different interest
rate environments, fair value
estimates can differ significantly,
especially for
certain
fixed
rate
instruments.
In
the
fair
values
do
not
attempt
to
the
value
of
the
Corporation’s fee
generating businesses and
anticipated future business
activities, that
is, they
do not
represent the
value as
a going concern.
There have been
no changes in
the Corporation’s valuation
methodologies and inputs
used to estimate
the fair values for each class of financial assets and
liabilities not measured at fair value.
The following tables present the
carrying amount and estimated fair
values of financial instruments with their
corresponding level in
value hierarchy.
The aggregate
amounts of
instruments disclosed
do not
represent management’s
estimate of the underlying value of the Corporation.
amount
Level 1
Level 2
Level 3
at NAV
Financial Assets:
$
377,079
$
377,079
$
$
$
$
377,079
4,744,211
10,180
[1]
33,106
8,026
24,878
33,106
[1]
14,261,996
1,181
Debt securities held-to-maturity:
$
$
$
$
$
$
45,760
6,799
40,334
47,133
Collateralized mortgage obligation-federal agency
1,506
1,315
1,315
Securities in wholly owned statutory business trusts
5,960
5,960
5,960
held-to-maturity
$
$
$
7,419,154
$
40,334
$
$
Equity securities:
FHLB stock
$
58,552
$
$
58,552
$
$
$
58,552
FRB stock
102,038
102,038
102,038
Other investments
58,403
50,047
8,137
59,009
Total equity securities
$
218,993
$
$
210,637
$
8,137
$
$
219,599
$
7,783
$
$
7,783
$
$
$
7,783
37,900,938
37,105,428
37,105,428
99,523
99,523
99,523
27,716
27,716
27,716
amount
Level 1
Level 2
Level 3
at NAV
Financial Liabilities:
$
$
$
$
$
$
9,419,413
9,419,413
$
$
$
66,311,423
$
$
$
66,311,423
$
56,853
$
$
56,859
$
$
$
56,859
[2]
400,000
400,000
400,000
Notes payable:
FHLB advances
$
195,312
$
$
193,131
$
$
$
193,131
Unsecured senior debt securities
396,249
420,152
420,152
Junior subordinated deferrable interest debentures
(related to trust preferred securities)
198,393
188,081
188,081
$
789,954
$
$
801,364
$
$
$
801,364
$
26,157
$
$
26,157
$
$
$
26,157
[1]
Refer to Note 21 to the Consolidated Financial Statements
for the fair value by class of financial asset and its hierarchy
level.
[2]
Refer to Note 13 to the Consolidated Financial Statements
for the composition of other short-term borrowings.
amount
Level 1
Level 2
Level 3
at NAV
Financial Assets:
$
419,638
$
419,638
$
$
$
$
419,638
6,371,180
9,768
[1]
32,783
2,814
29,752
32,783
[1]
10,730,998
2,734
Debt securities held-to-maturity:
$
$
$
$
$
$
51,865
6,866
44,711
51,577
Collateralized mortgage obligation-federal agency
1,518
1,304
1,304
Securities in wholly owned statutory business trusts
5,959
5,959
5,959
held-to-maturity
$
$
$
7,637,953
$
44,711
$
$
Equity securities:
FHLB stock
$
55,786
$
$
55,786
$
$
$
55,786
FRB stock
100,304
100,304
100,304
Other investments
52,076
45,664
6,528
52,573
Total equity securities
$
208,166
$
$
201,754
$
6,528
$
$
208,663
$
5,423
$
$
5,423
$
$
$
5,423
36,361,628
35,652,539
35,652,539
108,103
108,103
108,103
26,023
26,023
26,023
amount
Level 1
Level 2
Level 3
at NAV
Financial Liabilities:
$
$
$
$
$
$
9,012,882
8,795,803
8,795,803
$
$
$
64,667,266
$
$
$
64,667,266
$
54,833
$
$
54,845
$
$
$
54,845
[2]
225,000
225,000
225,000
Notes payable:
FHLB advances
$
302,722
$
$
295,023
$
$
$
295,023
Unsecured senior debt securities
395,198
415,148
415,148
Junior subordinated deferrable interest debentures
(related to trust preferred securities)
198,373
189,758
189,758
$
896,293
$
$
899,929
$
$
$
899,929
$
22,832
$
$
22,832
$
$
$
22,832
[1]
Refer to Note 21 to the Consolidated Financial Statements
for the fair value by class of financial asset and its hierarchy
level.
[2]
Refer to Note 13 to the Consolidated Financial Statements
for the composition of other short-term borrowings.
Refer
to
Note
to
the
for
the
notional
amount
of
commitments
to
extend
credit,
which
represents the unused portion of
credit facilities granted to customers,
and letters of credit,
which represent the contractual amount
that
is
required
to
be
paid
in
the
event
of
nonperformance,
at
30,
and
The
fair
value
of
commitments to
extend credit
and letters
of credit,
which are
the fees
charged to
enter into
those agreements,
are not
material to Popular’s financial statements.
Note 23 – Net income per common share
The following table sets forth the computation of net income per common share (“EPS”), basic and diluted, for the quarters and nine
months ended September 30, 2025 and 2024:
$
211,317
$
155,323
$
599,259
$
436,395
Preferred stock dividends
(353)
(353)
(1,059)
(1,059)
Net income applicable to common stock
$
210,964
$
154,970
$
598,200
$
435,336
Average common shares outstanding
67,058,260
71,807,136
68,121,447
71,882,273
Average potential dilutive common shares
35,554
21,266
22,239
29,880
Average common shares outstanding - assuming dilution
67,093,814
71,828,402
68,143,686
71,912,153
Basic EPS
$
3.15
$
2.16
$
8.78
$
6.06
Diluted EPS
$
3.14
$
2.16
$
8.78
$
6.05
For the quarters
2025 and 2024,
the Corporation calculated the
impact of potential
dilutive
common shares under the treasury stock method, consistent with the method used
for the preparation of the financial statements for
the year
ended December
For a
discussion of
the calculation
treasury stock
method, refer
to Note
30 of
the
Consolidated Financial Statements included in the
2024 Form 10-K.
Note 24 – Revenue from contracts with customers
The
table
the
revenue
streams
from
contracts
with
customers
by
segment
for
the
2025 and 2024.
BPPR
BPPR
$
36,392
$
2,685
$
109,042
$
7,915
Other service fees:
Debit card fees
27,868
81,809
Insurance fees, excluding reinsurance
9,449
1,772
25,849
5,682
Credit card fees, excluding late fees and membership
fees
27,846
81,376
1,040
Sale and administration of investment products
9,459
27,490
Trust fees
7,279
20,789
Total revenue from
contracts with customers [1]
$
118,293
$
4,974
$
346,355
$
15,262
[1]
The amounts include intersegment transactions of $
0.6
1.8
million, respectively, for the
quarter and nine months ended September 30,
BPPR
BPPR
$
35,699
$
2,616
$
105,770
$
7,513
Other service fees:
Debit card fees [2]
25,997
78,308
Insurance fees, excluding reinsurance
11,702
1,684
33,966
5,130
Credit card fees, excluding late fees and membership
fees [2]
26,189
76,828
1,205
Sale and administration of investment products
8,387
23,664
Trust fees
6,902
20,810
Total revenue from
contracts with customers [1]
$
114,876
$
4,879
$
339,346
$
14,447
[1]
The amounts include intersegment transactions of $
0.6
3.9
million, respectively, for the
quarter and nine months ended September 30,
[2]
Effective in the third quarter of 2024, the Corporation
reclassified certain interchange fees, which were
previously included jointly with credit card fees
from common network activity,
as debit card fees. For the nine month period ended September
30, 2024, interchange fees of approximately $
22.2
corresponding to the first and second quarters were
reclassified.
Revenue from contracts with
customers is recognized when,
or as, the performance
obligations are satisfied by
the Corporation by
transferring the promised services to the customers based on ASC 606 Revenue
from Contracts with Customers. Revenue streams
identified from contracts with customers, as
listed above, will have certain timing for
recognition based on the nature of
the contract
including when
the obligation is
satisfied and/or services
are rendered. Service
charges on
deposit accounts, debit
card fees,
and
credit card
fees are
recognized at
a point
in time,
occurrence of
an activity
or an
event. Interchange
fees on
debit and
credit
card
are
recognized upon
settlement
of
the
payment
transaction. For
more
details
over
nature
and
timing
of
revenue streams from contracts with customers refer to Note 31 on the
2024 Form 10-K for a complete description of the nature and
timing of revenue streams from contracts with customers.
Note 25 - Stock-based compensation
Incentive Plan
On May 12,
2020, the stockholders of
the Corporation approved the
2020 Omnibus Incentive Plan,
which permits the
Corporation to
issue several
types of
stock-based compensation
to employees
and directors
of the
Corporation and/or
any of
its
subsidiaries (the
“2020 Incentive
Plan”). The
2020 Incentive
Plan replaced
the Popular,
Inc. 2004
Omnibus Incentive
Plan, which
was in effect
prior to the adoption of
the 2020 Incentive Plan (the
“2004 Incentive Plan” and, together
with the 2020 Incentive
Plan,
the “Incentive Plan”). Participants under the Incentive Plan are designated by the Talent and Compensation Committee of the Board
of Directors (or its delegate, as determined by the Board). Under the Incentive Plan, the Corporation has issued restricted stock and
performance shares to its employees and restricted
stock and restricted stock units (“RSUs”)
to its directors.
The restricted
stock granted
Incentive Plan
to employees
becomes vested
the employees’
continued service
with
Popular.
Unless otherwise stated in an agreement, the compensation cost associated with the shares of restricted stock
granted prior to 2021 was determined based on a two-prong vesting schedule. These grants include ratable vesting over five or four
years commencing at the date of grant (“the graduated vesting portion”) with a portion vested at termination of employment after
attainment of 55 years of age and 10 years of service or 60 years of age and 5 years of service (“the retirement vesting portion”).
The graduated vesting portion is accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years
of service or 60 years of age and 5 years of service. Restricted stock granted on or after 2021 have ratable vesting in equal annual
installments over a period of 4 years or 3 years, depending on the classification of the employee. The vesting schedule is
accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age
and 5 years of service.
The
performance share
awards
granted
under
the
Plan
consist
of
the
opportunity
to
receive
shares
of
Inc.’s
common stock provided that the Corporation achieves certain goals during a three-year performance cycle.
The goals will be based
on
two
metrics
equally:
the
Relative
Total
Shareholder
Return
(“TSR”)
and
the
Absolute
Return
on
Average
Common Equity
(“ROATCE”). The
TSR metric
is a
market condition
under ASC
For equity
settled awards
market
conditions, the
is determined
as of
the grant
date and
is not
subsequently revised
actual performance.
The
ROATCE metric
is a performance condition under
ASC 718.
The fair value is
determined based on the probability of
achieving the
ROATCE
goal as
of each
reporting period.
The TSR
and ROATCE
metrics are
equally weighted
and work
independently.
The
number of shares that will ultimately vest ranges from 50% to a 150% target based on both market (TSR) and performance
(ROATCE) conditions. The performance shares will vest at the end of the three-year performance cycle. If a participant terminates
employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service, the
performance shares shall continue outstanding and vest at the end of the performance cycle.
The
table
summarizes
the
stock
and
shares
activity
under
the
Plan
for
members
of
management.
(Not in thousands)
Shares
Weighted-Average
Grant Date Fair
Value
Non-vested at December 31, 2023
299,896
$
58.20
Granted
242,474
86.62
Performance Shares Quantity Adjustment
(18,650)
87.79
Vested
(267,873)
74.26
(7,939)
50.68
Non-vested at December 31, 2024
247,908
$
66.86
Granted
225,928
100.32
Performance Shares Quantity Adjustment
43,961
91.54
Vested
(281,558)
90.26
(5,515)
60.68
Non-vested at September 30, 2025
230,724
$
75.82
During the quarter ended September 30,
2025,
no
shares of restricted stock (September
30, 2024 –
shares of restricted stock)
were awarded to management under the Incentive Plan. During the quarters ended September 30, 2025 and
2024,
no
shares
were
awarded
to
under
the
Plan.
During
the
nine
months
ended
30,
2025,
194,268
restricted stock (September
–
176,519
restricted stock) and
31,660
performance shares (September
30, 2024 -
65,225
performance shares) were awarded to management
under the Incentive Plan.
During
the
quarter
ended
30,
2025,
the
$
2.1
million
of
stock
expense
related
to
incentive
awards,
with
a
tax
benefit
of
$
0.4
million
30,
$
1.8
with
a
tax
benefit
of
$
0.4
For
the
nine
months
ended
30,
2025,
the
$
16.4
million
of
stock
expense
related to management incentive awards, with a tax
benefit of $
2.1
million (September 30, 2024 - $
12.3
million, with a tax benefit of
$
2.0
million). For the nine months ended
September 30, 2025, the fair market
value of the restricted stock
and performance shares
vested was $
20.0
million on the grant date and
$
27.4
million at vesting date. This
differential triggered a windfall of $
2.7
million that
was recorded
as a
reduction on
expense. During
$
(1.0)
million
of
shares
expense/(credit),
with
a
tax
benefit
of
$
(0.1)
million
due
to
shares
target
adjustment (September 30, 2024
- $
(0.5)
million, with a
tax benefit of
$
(32)
thousand).
For the nine
30,
$
3.2
million
of
performance shares
expense, with
a tax
$
0.3
million
(September 30,
2024 -
$
3.5
million, with
a tax
$
0.2
The total
unrecognized compensation cost
non-vested restricted
stock awards and performance shares to members of management at
September 30, 2025 was $
14.6
million and is expected to be
recognized over a weighted-average period of
1.58
years.
The following table summarizes the restricted stock
activity under the Incentive Plan for members of
the Board of Directors:
(Not in thousands)
RSUs / Restricted stock
Weighted-Average Grant
Date Fair Value per Unit
Non-vested at December 31, 2023
$
Granted
25,462
89.51
Vested
(25,462)
89.51
Non-vested at December 31, 2024
$
Granted
23,310
100.14
Vested
(4,197)
98.52
Non-vested at September 30, 2025
19,113
$
100.49
The
equity
awards
granted to
members of
the Board
of
Directors of
Inc.
(the
“Directors”) after
May
will
vest
and
become non-forfeitable on the first anniversary of the grant date of
such award. Equity awards granted to the Directors may be
paid
in either common stock or RSUs, at each Director’s
election. If RSUs are elected, the Directors may defer the delivery of the shares
of common stock underlying
the RSUs award until
their retirement. To
the extent that cash
dividends are paid on
outstanding common stock, the Directors
will receive an additional number of RSUs
that reflect a reinvested dividend equivalent.
During
the
quarter
ended
30,
2025,
1,260
RSUs
and
no
shares
of
stock
were
granted
to
the
Directors
30,
1,281
RSUs
and
no
shares
of
stock)
and
the
$
0.6
million
of
expense
related to these shares with
a tax benefit of $
0.1
million (September 30, 2024 - $
0.1
million with a tax benefit
of $
thousand). For
the
nine
months
30,
2025,
the
granted
20,622
RSUs
and
2,688
shares
of
restricted stock
to
the
Directors (September 30, 2024 -
22,887
RSUs and
1,392
shares of unrestricted stock)
and the Corporation recognized $
1.3
million
of expense related
to these shares,
with a tax
benefit of $
0.2
million, (September 30, 2024
- $
2.2
million, with a
tax benefit of
$
0.4
million). The fair value at vesting
date of the RSUs vested
during the nine months ended September 30, 2025
for the Directors was
$
2.3
Note 26 – Income taxes
The table below presents a reconciliation of
the statutory income tax rate to the effective income tax
rate:
Amount
income
Amount
income
Computed income tax expense at statutory rates
$
92,733
37.5
%
$
74,169
37.5
%
Net benefit of tax exempt income
(51,732)
(20.9)
(29,055)
(13.3)
Effect of income subject to preferential tax rate
(2,490)
(1.0)
(327)
Deferred tax asset valuation allowance
2,748
1.1
Difference in tax rates due to multiple jurisdictions
(6,212)
(2.5)
(6,764)
(3.1)
State and local taxes
2,717
1.1
3,429
0.4
Others
(1,794)
(0.8)
$
35,970
14.5
%
$
42,463
21.5
%
Amount
income
Amount
income
Computed income tax expense at statutory rates
$
273,066
37.5
%
$
215,582
37.5
%
Net benefit of tax exempt income
(137,061)
(18.8)
(91,035)
(15.8)
Effect of income subject to preferential tax rate
(4,009)
(0.6)
(475)
(0.1)
Deferred tax asset valuation allowance
10,680
1.5
2,779
0.5
Difference in tax rates due to multiple jurisdictions
(11,469)
(1.6)
(11,893)
(2.1)
Other tax benefits
(4,500)
(0.8)
Tax on intercompany
[1]
24,325
4.2
U.S., States, and local taxes
7,167
1.0
6,669
1.2
Others
(9,456)
(1.3)
(2,962)
(0.5)
$
128,918
17.7
%
$
138,490
24.1
%
[1]
16.5
million of out-of-period adjustment recorded during the
first quarter of 2024.
Deferred income taxes reflect the
net tax effects
of temporary differences between the
carrying amounts of assets and
liabilities for
financial reporting
purposes and
their tax
bases. Significant
components of
liabilities at
September 30, 2025, and December 31, 2024,
were as follows:
PR
US
Total
Deferred tax assets:
Tax credits available
for carryforward
$
4,861
$
38,382
$
43,243
Net operating loss and other carryforward available
60,370
584,546
644,916
Postretirement and pension benefits
28,228
28,228
249,065
28,482
277,547
Deferred loan origination fees/cost
4,533
(2,844)
1,689
Depreciation
7,700
7,742
15,442
FDIC-assisted transaction
152,665
152,665
Lease liability
28,040
18,572
46,612
Unrealized net loss on investment securities
179,530
14,083
193,613
Difference in outside basis from pass-through entities
53,182
53,182
Mortgage Servicing Rights
15,051
15,051
33,698
8,555
42,253
816,923
697,518
1,514,441
Deferred tax liabilities:
Intangibles
91,503
55,023
146,526
Right of use assets
25,509
16,666
42,175
Loans acquired
17,244
17,244
7,476
7,905
tax liabilities
141,732
72,118
213,850
Valuation allowance
78,134
386,914
465,048
Net deferred tax asset
$
597,057
$
238,486
$
835,543
PR
US
Total
Deferred tax assets:
Tax credits available
for carryforward
$
4,861
$
24,728
$
29,589
Net operating loss and other carryforward available
52,211
610,279
662,490
Postretirement and pension benefits
27,786
27,786
247,153
24,415
271,568
Depreciation
7,700
7,229
14,929
FDIC-assisted transaction
152,665
152,665
Lease liability
25,167
16,451
41,618
Unrealized net loss on investment securities
252,411
20,996
273,407
Difference in outside basis from pass-through entities
50,144
50,144
Mortgage Servicing Rights
14,475
14,475
41,127
9,072
50,199
875,700
713,170
1,588,870
Deferred tax liabilities:
Intangibles
88,351
55,926
144,277
Right of use assets
22,784
14,454
37,238
Deferred loan origination fees/cost
(1,880)
2,085
Loans acquired
18,415
18,415
6,799
7,228
tax liabilities
134,469
72,894
207,363
Valuation allowance
69,837
386,914
456,751
Net deferred tax asset
$
671,394
$
253,362
$
924,756
The
net
deferred
tax
assets
shown
in
the
table
above
at
30,
2025,
is
in
the
of
Financial Condition as $
837.3
million in net
deferred tax assets in
the “Other assets” caption
(December 31, 2024
- $
926.3
million)
and $
1.8
million in deferred tax liabilities in the “Other liabilities” caption (December 31, 2024 - $
1.6
million), reflecting the aggregate
assets or
liabilities of
individual tax-paying
of the
Corporation in
their
respective tax
jurisdiction, Puerto
Rico or the United States.
At September 30, 2025, the net deferred tax
assets of the U.S. operations amounted to $
625.4
million with a valuation allowance of
$
386.9
million, for
net
assets
after valuation
allowance of
$
238.5
million. The
Corporation evaluates
on
a
basis the
realization of
the deferred
tax asset
by taxing
jurisdiction.
The U.
S. operations
sustained profitability
for the
last three
years.
These historical financial results are objectively verifiable positive evidence, evaluated
together with the positive evidence of
stable credit
metrics. On
the other
hand, the
Corporation evaluated
the negative
evidence accumulated
over the
years, including
financial results
lower than
expectations and
challenges to
the economy
due to
inflationary pressures
that could
stem from
U. S.
tariff policies and
global geopolitical challenges,
in addition to
the economic effect
of cuts in
federal government spending and
the
length of the federal budget
impasse that could negatively impact U.
S. operations’ achieving expected pre-tax income
levels in the
near future.
As of September 30, 2025, after weighting all positive and negative evidence, the Corporation concluded that it is more
likely than not that $
238.5
million of the deferred tax assets from
the U.S. operations, comprised mainly of net
operating losses, will
be realized. The
Corporation based this determination
on its estimated
earnings available to
realize the deferred
tax assets for
the
remaining carryforward
period, together
historical level
of book
income adjusted
by permanent
differences. Management
will continue to monitor
and review the U.S. operation’s
results, including recent earnings trends, the
pre-tax earnings forecast, any
new tax initiative, and other factors, including net income
versus forecast, targeted loan growth, net interest
income margin, changes
in deposit costs, allowance for credit losses, charge offs, non-performing loans held-in-portfolio (“NPLs”) inflows and non-performing
asset (“NPA”)
balances. Significant changes in
these factors or
sustainable continuance of
financial improvement could impact
the
future realization of the deferred tax assets.
the Corporation’s net deferred
tax assets related to
its Puerto Rico operations amounted
to $
597.1
The
Puerto
Rico
Banking
operation
has
a
historical
record
of
profitability.
This
is
a
strong
piece
of
objectively verifiable
positive evidence
that outweighs
any negative
evidence considered
by Management
in the
evaluation of
the
realization
of
the
deferred
tax
assets.
Based
on
this
evidence
and
of
future
taxable
income,
the
Corporation has concluded that it is more likely than not that such net deferred tax assets
of the Puerto Rico Banking operations will
be realized.
The Holding Company operation has been in a cumulative
loss position in recent years.
Management expects these losses will be a
trend
in
future
years.
This
objectively
verifiable
evidence is
by
Management strong
evidence that
suggests that
income in
future years
will be
insufficient to
support the
realization of
all deferred
tax assets.
After weighting
of all
positive
and
negative evidence
Management concluded,
as
of
the reporting
date,
that
it
is
more
likely
than
not that
the
Holding
Company will not be
able to realize any
portion of the deferred tax
assets. Accordingly, the
Corporation has maintained a valuation
allowance on the deferred tax assets of $
78.1
million as of September 30, 2025.
The reconciliation of unrecognized tax benefits, excluding
interest, was as follows:
January 1
$
1.5
$
1.5
March 31
$
1.5
$
1.5
June 30
$
1.5
$
1.5
Balance at September 30
$
1.5
$
1.5
the total
accrued interest
recognized in
the statement
of financial
condition amounted
to $
2.5
2.4
million). Management determined that at September 30,
2025 and December 31, 2024, there was
no
need to accrue for the
payment of penalties. The Corporation’s policy
is to report interest related
to unrecognized tax benefits in
income
tax
expense,
while
the
penalties,
if
any,
are
reported
in
other
in
the
of
Operations.
After consideration
of the
effect on
U.S. federal
tax of
unrecognized U.S.
state tax
benefits, the
total amount
of unrecognized
tax
benefits that if recognized, would affect
the Corporation’s effective tax rate,
was $
3.0
million at September 30, 2025 (December
31,
3.0
The amount of
unrecognized tax benefits
may increase or
decrease in the
future for various
reasons including adding amounts
for
current
tax
year
positions,
expiration
of
open
income
tax
returns
due
to
the
statutes
of
limitation,
changes
in
Management’s
judgment about
the level
of uncertainty,
status of
examinations, litigation
and legislative
activity and
the addition
or elimination
of
uncertain tax positions.
The Corporation does not
anticipate a reduction
in the total
amount of unrecognized tax
benefits within the
next 12 months.
The
Corporation and
its subsidiaries
file
returns in
Puerto
Rico, the
U.S. federal
jurisdiction, various
U.S. states
and
political subdivisions, and foreign jurisdictions. At September 30, 2025, the following years remain subject to examination in the U.S.
Federal jurisdiction: 2022 and thereafter; and in
the Puerto Rico jurisdiction, 2018 and thereafter.
Note 27 – Supplemental disclosure on the consolidated
statements of cash flows
Additional disclosures on cash flow information and
non-cash activities for the nine months ended
September 30, 2025 and
September 30, 2024 are listed in the following table:
Non-cash activities:
Loans transferred to other real estate
$
20,915
$
34,756
Loans transferred to other property
66,838
61,447
Total loans transferred
to foreclosed assets
87,753
96,203
Loans transferred to other assets
37,338
37,495
Financed sales of other real estate assets
5,234
8,551
Financed sales of other foreclosed assets
43,032
39,283
Total financed sales
of foreclosed assets
48,266
47,834
Financed sale of premises and equipment
41,746
59,628
Transfers from loans held-in-portfolio to
loans held-for-sale
5,739
7,505
Transfers from loans held-for-sale to loans
1,792
5,084
Loans securitized into investment securities
[1]
6,852
11,162
Trades receivable from brokers and counterparties
9,125
4,983
Trades payable to brokers and counterparties
306,775
3,540
Net change in receivables from investments maturities
13,861
176,000
Recognition of mortgage servicing rights on securitizations
or asset transfers
Loans booked under the GNMA buy-back option
5,349
2,836
Capitalization of lease right of use asset
33,276
2,553
[1]
Includes loans securitized into trading securities and subsequently
sold before quarter end.
The following table provides a reconciliation of
cash and due from banks, and restricted cash
reported within the Consolidated
Statement of Financial Condition that sum to the total of
the same such amounts shown in the Consolidated
Statement of Cash
Flows.
$
370,684
$
418,168
Restricted cash and due from banks
6,395
9,426
Restricted cash in money market investments
10,180
8,072
Total cash and due
from banks, and restricted cash
[2]
$
387,259
$
435,666
[2]
Refer to Note 4 - Restrictions on cash and due from banks
and certain securities for nature of restrictions.
Note 28 – Segment reporting
The
corporate
structure
of
two
–
Banco Popular de Puerto Rico and Popular U.S.
Management determined the reportable segments based on the internal reporting used to evaluate performance and to assess
where to allocate resources.
The segments were
determined based on the
organizational structure, which focuses
primarily on the
markets the segments serve, as well as on the products
and services offered by the segments.
The chief operating
decision maker (“CODM”) of
the Corporation is
the Chief Executive
Officer (“CEO”) who
utilizes net income
as
one of
the segment
profitability measures,
to evaluate
the performance
of each
reportable segment and
assess where
to allocate
resources effectively.
The CEO
receives
profitability reports
that
include net
income
per segment,
net
interest income
and
other
income
and expense
categories. The
CODM uses
the segment’s
and components
of net
income, including
segment
revenues and
expenses to
assess performance
and to
manage important
aspects by
each reportable
segments,
such as
human
capital, investment in technology, making budget allocations,
as well as other strategic decisions.
Banco Popular de Puerto Rico:
The Banco
Popular de
reportable segment
includes commercial,
consumer and
retail banking
operations, as
well as
mortgage and auto lending operations conducted
at BPPR, including U.S. based activities conducted
through its New York
Branch.
Other financial
services within the
include the trust
service units
of BPPR,
asset management services
of Popular
Asset Management and
the brokerage operations
of Popular Securities,
and the insurance
agency and reinsurance
businesses of
Popular Insurance, Popular Risk Services, Popular Life
Re, and Popular Re.
Popular U.S.:
Popular U.S. reportable segment
consists of the
banking operations of Popular
Bank (PB), Popular Insurance
Agency, U.S.A.,
and
PEF.
PB
operates through
a retail
branch network
in the
U.S. mainland
name of
financing services through PEF.
Popular Insurance Agency,
U.S.A. offers investment and insurance
services across the PB
branch
network.
The Corporate group
consists primarily of
the holding companies
Popular, Inc.,
Popular North America,
Popular International Bank
and certain of the Corporation’s investments accounted for under
the equity method, including BHD.
The
policies
of
the
individual
are
the
same
as
those
of
the
Transactions
between
reportable segments are primarily conducted at market rates, resulting
in profits that are eliminated for reporting consolidated results
of
operations. Assets
representing transactions
between reportable
or
the
group
are
also
eliminated in
the
tables presented below.
The tables that follow present the results of operations
and total assets by reportable segments:
BPPR
$
765,204
$
201,327
$
(423)
214,489
96,124
(423)
550,715
105,203
73,326
1,833
150,619
6,888
170,524
28,451
12,764
2,643
67,146
9,977
37,794
13,000
10,759
2,439
[1]
113,649
26,463
412,876
83,724
215,132
26,534
26,104
8,732
$
189,028
$
17,802
$
$
59,771,004
$
14,940,858
$
(50,833)
Inc.
$
966,108
$
1,373
$
(832)
$
966,649
310,190
10,786
(832)
320,144
655,918
(9,413)
646,505
75,159
(34)
75,125
157,507
15,330
(1,642)
171,195
198,975
34,013
232,988
15,407
10,682
(281)
25,808
77,123
9,994
87,117
38,401
38,408
13,000
13,000
13,198
13,582
[1]
140,112
(54,815)
(1,297)
84,000
496,600
(1,578)
495,287
241,666
5,686
(64)
247,288
34,836
1,120
35,971
$
206,830
$
4,566
$
(79)
$
211,317
$
74,661,029
$
5,772,344
$
(5,367,575)
$
[1]
BPPR
$
2,245,804
$
583,387
$
(3,145)
634,722
283,048
(3,145)
1,611,082
300,339
169,290
18,975
433,809
20,452
486,602
81,280
38,848
7,832
195,523
30,410
112,249
1,786
13,000
30,797
6,902
[1]
374,407
80,103
1,239,248
221,857
636,353
79,959
96,803
24,734
$
539,550
$
55,225
$
$
59,771,004
$
14,940,858
$
(50,833)
Total
$
2,826,046
$
4,487
$
(3,014)
$
2,827,519
914,625
32,257
(3,014)
943,868
1,911,421
(27,770)
188,265
(118)
188,147
454,261
40,466
(2,994)
491,733
567,882
107,174
675,056
46,680
34,926
(865)
80,741
225,933
29,548
255,481
114,035
114,050
1,366
1,366
13,000
13,000
37,699
1,202
38,901
[1]
454,510
(171,398)
(2,647)
280,465
1,461,105
1,467
(3,512)
716,312
11,347
728,177
121,537
7,072
128,918
$
594,775
$
4,275
$
$
599,259
$
74,661,029
$
5,772,344
$
(5,367,575)
$
[1]
BPPR
$
743,936
$
195,102
$
(2,345)
255,928
101,974
(2,345)
488,008
93,128
77,514
(6,066)
149,050
6,789
149,563
26,372
14,490
2,821
67,778
9,959
33,775
13,023
2,063
[1]
124,621
22,662
403,644
64,729
155,900
41,254
30,064
12,472
$
125,836
$
28,782
$
$
56,906,693
$
14,306,045
$
(260,464)
Inc.
936,693
2,098
(1,343)
937,448
355,557
10,761
(1,343)
364,975
$
581,136
$
(8,663)
$
$
572,473
71,448
71,448
155,839
8,876
(633)
164,082
175,935
25,921
201,856
17,311
9,584
(187)
26,708
77,737
10,715
88,452
34,317
34,320
15,086
15,471
[1]
147,283
(46,614)
(859)
99,810
468,373
(6)
(1,046)
467,321
197,154
197,786
Income tax expense (benefit)
42,536
(279)
42,463
$
154,618
$
$
$
155,323
$
70,952,274
$
5,887,340
$
(5,516,540)
$
71,323,074
[1]
BPPR
$
2,195,266
$
564,580
$
(8,254)
745,672
300,748
(8,254)
1,449,594
263,832
188,576
1,806
447,073
19,909
(56)
448,253
79,578
41,426
9,454
(56)
191,218
28,643
105,866
1,730
1,302
39,349
6,210
[1]
383,500
77,902
1,210,914
204,448
(56)
497,177
77,487
92,810
23,917
$
404,367
$
53,570
$
$
56,906,693
$
14,306,045
$
(260,464)
Total
$
2,751,592
$
10,287
$
(8,383)
$
2,753,496
1,038,166
32,184
(8,383)
1,713,426
(21,897)
190,382
190,840
466,926
31,314
(4,034)
494,206
527,831
86,826
614,657
50,824
43,312
(766)
93,370
219,861
27,805
247,666
107,596
107,610
2,233
2,233
45,559
1,161
46,720
[1]
461,402
(150,953)
(2,695)
307,754
1,415,306
8,165
(3,461)
574,664
(573)
574,885
Income tax expense (benefit)
116,727
21,921
(158)
138,490
$
457,937
$
(21,127)
$
(415)
$
436,395
$
70,952,274
$
5,887,340
$
(5,516,540)
$
71,323,074
[1]
Geographic Information
The following information presents selected
financial information based on the
geographic location where the Corporation conducts
its business. The
banking operations of BPPR
are primarily based in
Puerto Rico, where it
has the largest retail
banking franchise.
BPPR
also
conducts
banking
in
the
U.S.
Virgin
the
British
Virgin
Islands
and
New
York.
banking
operations in
the mainland
include commercial
lending activities
in addition
to
periodic loan
participations with
PB.
During the nine months ended September 30, 2025, BPPR participated in loans originated by PB totaling $
million (2024 - did
no
t
participate). Total
assets for
the BPPR
segment related
to its
operations in the
$
1.4
billion (December
- $
1.6
billion), including $
multifamily loans (December
- $
million), $
million in commercial
real estate loans (December 31, 2024 - $
million), $
million in C&I loans (December 31, 2024 - $
million), and $
million
in unsecured
personal loans
(December 31,
2024 -
$
million). During
BPPR
segment generated $
75.6
million (September 30,
91.2
million) in revenues
from its operations in
the United States,
mainly
from
net
income.
In
the
Virgin
the
BPPR
segment
offers
banking
products,
including loans
and
deposits.
Total
assets for the BPPR segment related to
its operations in the U.S. and British
Virgin Islands amounted to $
1.1
billion (December 31,
2024 -
$
1.0
billion). The
generated $
38.7
revenues during
(September 30, 2024 - $
32.3
million) from its operations in the U.S. and
British Virgin Islands.
Geographic Information
Quarter ended
Revenues:
[1]
$
654,274
$
582,953
$
1,900,467
$
1,735,035
135,852
133,067
402,342
386,819
Other
27,574
20,535
72,575
63,881
Total consolidated
revenues
$
817,700
$
736,555
$
2,375,384
$
2,185,735
[1]
Total revenues include
net interest income, service charges on deposit accounts,
other service fees, mortgage banking activities, net
gain (loss),
including impairment, on equity securities, net gain on trading
account debt securities, adjustments to indemnity reserves
on loans sold, and
other operating income.
Selected Balance Sheet Information:
$
57,492,551
$
55,888,211
Loans
25,362,400
24,154,610
52,929,118
52,099,309
$
16,279,331
$
15,890,339
Loans
12,815,827
12,431,859
11,861,212
11,030,879
Other
$
1,293,916
$
1,266,833
Loans
516,714
526,606
[1]
1,723,074
1,754,157
[1]
Represents deposits from BPPR operations located in the
U.S. and British Virgin Islands.
AND RESULTS OF OPERATIONS
This
report
includes
and
analysis
(“MD&A”)
of
the
consolidated
and
of
Inc.
(the
“Corporation”
or
“Popular”). All
accompanying
tables,
and
notes
elsewhere in this report should be considered an
integral part of this analysis.
The Corporation is a
diversified, publicly owned financial holding company subject
to the supervision and regulation
of the Board of
Governors of the Federal Reserve System. The Corporation has
operations in Puerto Rico, the United States (“U.S.”) mainland and
the U.S. and British Virgin Islands. In Puerto Rico, the
Corporation provides retail, mortgage,
commercial banking services and auto
financing through its
principal banking subsidiary,
Banco Popular de
(“BPPR”), as
well as
broker-dealer and
insurance services
through specialized
subsidiaries. In
the
U.S. mainland,
the
Corporation provides
retail and
banking
services,
as
well
as
equipment
leasing
and
financing,
through
its
New
York-chartered
banking
Popular
Bank
(“PB”
or
“Popular
U.S.”),
which
has
branches
located
in
New
York,
New
Jersey
and
Florida.
Note
to
the
Consolidated Financial Statements presents information
about the Corporation’s business segments.
As a financial services company,
the Corporation’s earnings are significantly affected
by general business and economic conditions
in the
markets which
we serve.
Lending and
deposit activities
and fee
income generation
are influenced
by the
level of
spending and
investment, consumer
income, spending
and savings,
capital market
activities, competition,
customer preferences,
interest rate conditions and prevailing market rates
on competing products.
operates in
a highly
regulated environment
and may
be adversely
affected by
federal and
local laws
and
regulations.
Also,
competition
with
other
institutions,
as
well
as
with
non-traditional financial
service
providers
and
technology
companies
that
provide
electronic
and
internet-based
solutions
and
services,
could
adversely
affect
its
profitability.
The
continuously
monitors
general
and
conditions,
industry-related
indicators
and
trends,
competition, interest rate volatility, credit quality indicators, loan, and deposit demand, operational and systems efficiencies, revenue
enhancements and changes in the regulation of financial
services companies.
The description of the Corporation’s business contained in
discusses additional
information about the business of the Corporation. Readers should also refer to “Part I - Item 1A” of the 2024 Form 10-K and “Part II
- Item 1A” of this Form 10-Q for a discussion of certain risks and uncertainties to which the Corporation is subject, many beyond the
Corporation’s control that, in addition to the other information in
this Form 10-Q, readers should consider.
The Corporation’s common stock is traded on the NASDAQ
Global Select Market under the symbol BPOP.
OVERVIEW
Financial highlights for the quarter ended September 30,
net income for
2025 amounted to
$211.3
million, an
$56.0 million
when compared to a
net income of $155.3 million
for the quarter ended September
30, 2024. Higher net
income was mainly driven
by higher net interest income, offset in part by an increase
in operating expense.
Financial highlights for the quarter ended September 30,
2025 include:
Net
income
to
$646.5
an
of
$74.0
million
when
to
the
quarter
ended
2024, driven
by lower cost
of deposits,
investments in U.S.
Treasury securities
at higher yields
and loan
growth.
Net interest income on
a taxable equivalent basis for
the third quarter of
2025 was $720.8 million,
$107.9
Net
margin
expanded
by
bps
to
3.51%.
On
a
taxable
equivalent
basis,
net
margin
expanded by 43 basis points to 3.90%.
The provision for
credit losses amounted to
$75.1 million for the
2025, an increase of
$3.7
million
to
the
quarter
ended
30,
2024,
driven
by
higher
in
the
loans
portfolio, mainly due to two unrelated NPL inflows during the quarter, partially offset by
a lower provision for the consumer
loans portfolio due to improvements in credit quality.
Non-interest
income
to
$171.2
an
of
$7.1
million
when
to
the
quarter
ended
September 30, 2024, mainly driven by
higher credit and debit card fee income,
a favorable valuation adjustment of equity
securities held for deferred compensation plans, higher other operating income
due to a retroactive charge to a tenant
for
energy supplied in prior years, and higher investment
management fees.
Operating expenses amounted to $495.3 million for
the quarter, reflecting
an increase of $28.0 million when
the quarter ended September 30, 2024.
The increase was mainly driven by
higher personnel costs, primarily due to profit
sharing
accrual
and
higher
and
a
non-cash
charge
related
to
our
U.S.
based
leasing
partially offset by lower insurance claims and operational
losses reserves and lower equipment expenses.
of $36.0 million with
an effective tax
rate (“ETR”) of
14.5% during the
to an
expense of
$42.5 million
with an
ETR of
21.5% for
30,
2024 due to higher tax-exempt income and tax
credit purchases during 2025.
At September 30,
2025, the Corporation’s
total assets amounted
to $75.1 billion,
compared to $73.0
billion at December
31,
The
of
$2.1
billion
is
due
to
higher
balance
in
the
(“AFS”)
mainly
driven
by
higher
U.S.
and
an
across
most
loan
portfolios,
mainly
in
and
construction,
offset
by
lower
balance
in
the
money
market
investments,
held-to-
maturity (“HTM”) investment securities, and a decrease
in other assets.
Deposits amounted to $66.5 billion at September 30, 2025, an increase of $1.6 billion from December 31, 2024, driven by
an increase in high-cost deposits,
mainly time deposits at PB, and P.R. public deposits.
Stockholders’ equity amounted to $6.1 billion at September 30, 2025,
compared to $5.6 billion at December 31, 2024. The
Corporation and
its
continue to
be
well capitalized.
As
of
30,
tangible book value per common share was $79.12, an increase of $10.96 from December 31, 2024. The Common Equity
Tier 1 Capital ratio at September 30, 2025 was 15.79%,
compared to 16.03% at December 31, 2024.
Refer to Table 1 for selected financial data for the quarters ended September 30, 2025 and
September 30, 2024.
Table 1 - Financial Highlights
Financial Condition Highlights
Ending balances at
Average for the nine months ended
$
$
$
(1,626,557)
$
6,205,101
$
6,663,967
$
(458,866)
28,371,673
26,244,977
2,126,696
28,758,022
27,701,911
1,056,111
Loans
[1]
1,581,866
37,692,744
35,411,807
2,280,937
Earning assets
71,821,005
69,739,000
2,082,005
72,655,867
69,777,685
2,878,182
2,020,415
75,776,756
72,851,597
2,925,159
1,629,059
66,452,057
64,521,953
1,930,104
1,246,807
1,176,126
70,681
1,145,836
1,039,130
106,706
Total liabilities
68,950,126
67,432,317
1,517,809
68,584,814
66,530,111
2,054,703
502,606
7,191,941
6,321,486
870,455
Note: Average balances exclude unrealized gains or losses on debt securities available-for-sale and the unrealized loss related to certain securities transferred from available-for-
sale to held-to-maturity.
Operating Highlights
$
646,505
$
572,473
$
74,032
$
$
$
192,122
75,125
71,448
3,677
188,147
190,840
(2,693)
171,195
164,082
7,113
491,733
494,206
(2,473)
Operating expenses
495,287
467,321
27,966
39,050
247,288
197,786
49,502
728,177
574,885
153,292
35,971
42,463
(6,492)
128,918
138,490
(9,572)
$
211,317
$
155,323
$
55,994
$
599,259
$
436,395
$
162,864
Net income applicable to common stock
$
210,964
$
154,970
$
55,994
$
598,200
$
435,336
$
162,864
Net income per common share – basic
$
3.15
$
2.16
$
0.99
$
8.78
$
6.06
$
2.72
Net income per common share – diluted
$
3.14
$
2.16
$
0.98
$
8.78
$
6.05
$
2.73
Dividends declared per common share
$
0.75
$
0.62
$
0.13
$
2.15
$
1.86
$
0.29
Selected Statistical Information
Common Stock Data
End market price
$
129.10
100.27
$
129.10
100.27
Book value per common share at period end
91.00
80.35
91.00
80.35
Profitability Ratios
Return on assets
1.09
%
0.84
%
1.06
%
0.79
%
Return on common equity
11.60
8.82
11.15
8.43
Net interest spread (non-taxable equivalent basis)
2.87
2.43
2.81
2.41
Net interest spread (taxable equivalent) - Non-GAAP
3.26
2.66
3.18
2.65
Net interest margin (non-taxable equivalent basis)
3.51
3.24
3.46
3.20
Net interest margin (taxable equivalent) - Non-GAAP
3.90
3.47
3.83
3.44
Capitalization Ratios
Average equity to average assets
9.46
%
8.86
%
9.49
%
8.68
%
Common equity Tier 1 capital
15.79
16.42
15.79
16.42
Tangible common
book value per common share (non-GAAP)
[2]
79.12
69.04
79.12
69.04
Return on average tangible common equity
[2]
13.06
9.98
12.57
9.56
Tier I capital
15.84
16.48
15.84
16.48
Total capital
17.58
18.24
17.58
18.24
Tier 1 leverage
8.48
8.67
8.48
8.67
[1]
Includes loans held-for-sale.
[2]
Refer to Table 10 for reconciliation to GAAP financial measures.
Non-GAAP Financial Measures
This Form 10-Q
contains financial information
prepared under accounting
principles generally accepted in
the United States
(“U.S.
GAAP”)
and
measures.
uses
when
it
is
determined
that
these
measures provide
meaningful information
about the
underlying performance
of the
Corporation’s ongoing
operations. Non-GAAP
financial measures used by the Corporation may not be comparable to similarly named non-GAAP financial measures used by
other
companies.
Adjusted net income - Non-GAAP Financial Measure
In
analyzing the
results on
a reported
basis, management
monitors whether
the
impact of
certain non-
recurring or
infrequent transactions
need to
be excluded
results of
operations to
present what
is then
considered to
be
net
of
the
believes
that
the
net
provides
meaningful
about
the
of
the
ongoing
operations.
The
net
is
a
measure.
the adjusted
for the
30, 2024.
There were
no non-GAAP
adjustments for the nine months ended September
30, 2025.
Table 2 - Adjusted Net Income
for the Nine Months Ended September 30, 2024 (Non-GAAP)
Income before
Income tax
expense
Total
U.S. GAAP Net income
$574,885
$138,490
$436,395
Non-GAAP Adjustments:
FDIC Special Assessment [1]
14,287
(5,234)
9,053
Adjustments related to intercompany distributions [2]
6,400
16,483
22,883
Adjusted net income (Non-GAAP)
$595,572
$127,241
$468,331
[1] Expense recorded during the first quarter of 2024 to
increase the estimate recognized during the fourth
quarter of 2023 related to the November 16,
2023 FDIC Special Assessment to recover the losses to the
deposit insurance fund used by the FDIC in connection
with the receiverships of several
failed banks. The special assessment amount and collection
period may change if the estimated loss is periodically
adjusted or if the total amount
collected varies.
[2] Income tax expense and other related expenses from
prior periods related to withholding taxes on certain
distributions from U.S. subsidiaries.
Net interest income on a taxable equivalent basis
– Non-GAAP Financial Measure
Net interest income, on
a taxable equivalent basis,
is presented with its
different components in Table
s
3 and 4 for
the quarter and
30,
2025, as
compared with
period in
2024, segregated
by major
categories of
earning assets and interest-bearing liabilities.
The
main
sources
of
tax-exempt
income
are
certain
loans
and
in
of
the
U.S.
its
agencies and sponsored entities, and
certain obligations of the
Commonwealth of Puerto Rico and
its agencies and assets
held by
the Corporation’s international
banking entities. On
tables 3 and
4, the interest
income has been
converted to a
basis, using the applicable statutory income tax rates for each period net of interest expense that the Puerto Rico tax law requires to
be disallowed, based on an equal proportion of tax-exempt assets to total assets, and by an allocation of general and administrative
expenses attributable to exempt income, reducing the benefit of
the tax-exempt income. The effective yield, on a
basis, will
vary depending on
the level
of these
expenses that are
attributable to
the available exempt
income. Under Puerto
Rico
tax
law,
the
exempt
can
be
deducted
up
to
the
amount
of
taxable
income.
Management believes
that
this
provides meaningful information since it facilitates the comparison
of revenues arising from taxable and exempt
sources.
Tangible Common Equity and Tangible Assets
tangible common equity ratio, tangible
assets and tangible book value
per common share are
financial measures.
common equity
ratio and
tangible book
value per
common share
should be
used in
conjunction with
more
traditional
bank
capital
ratios
commonly
used
by
banks
and
analysts
to
compare
the
capital
adequacy
of
banking
organizations
with
amounts
of
or
other
intangible
assets,
typically
stemming
from
the
use
of
the
purchase
accounting method for
mergers and acquisitions.
tangible assets
and other related
measures should not
be
used
in
isolation
or
as
a substitute
for
stockholders' equity,
total
assets
or
any
other
measure calculated
in
accordance
with
GAAP.
Moreover, the
way the Corporation
calculates its tangible
tangible assets and
other related measures
may
differ from that of other companies reporting measures
with similar names.
Table
10 provides
a reconciliation of
total stockholders’ equity
to tangible common
equity and total
assets to tangible
assets as
of
CRITICAL ACCOUNTING POLICIES / ESTIMATES
The accounting and reporting policies followed by the Corporation
and its subsidiaries conform to U.S. GAAP and
general practices
within
the
industry.
Various
elements
of
the
policies,
by
their
nature,
are
inherently
subject to estimation techniques, valuation assumptions
and other subjective assessments.
has
discussed
the
and
selection
of
the
critical
with
the
Audit
Committee. The Corporation has identified as critical accounting estimates those related to: (i) Fair Value
Measurement of Financial
Instruments;
(ii)
Loans
and
for
Credit
Losses;
(iii)
Income
Taxes;
(iv)
and
Other
Intangible
Assets;
and
(v)
Pension and Postretirement
Benefit Obligations. For
a summary of
these critical accounting
estimates, refer to
the MD&A included
in
the
Form
10-K.
Also,
refer
to
Note
to
the
in
the
Form
10-K
for
a
summary of the Corporation’s significant accounting policies and to Note 3 to the Consolidated Financial Statements included in this
Form 10-Q for information on recently adopted accounting
standard updates.
STATEMENT
OF OPERATIONS ANALYSIS
NET INTEREST INCOME
Net interest income (“NII”)
for the quarter ended
September 30, 2025 was
$646.5 million an increase of
$74.0 million, compared to
the same quarter in 2024. The increase in net interest income was supported by lower cost
of deposits, mainly P.R.
higher income from investments in U.S. Treasury securities at
higher yields, and from loan growth. Net interest income on a
taxable
equivalent basis for the third quarter of 2025
was $720.8 million, an increase of $107.9
Net interest margin
(“NIM”) for the
quarter was 3.51%,
27 basis points
when compared to the
third quarter of
On a
basis, net
interest margin
for the
of 2025
was 3.90%,
of 43
when
compared to the third quarter of 2024, driven
by higher level of tax-exempt securities and loans. NIM expansion, when compared
to
the same quarter of
the previous year,
was mainly attributable to
lower deposit costs driven
as a result of
the repricing of high-cost
deposits that
are market-linked,
mainly those
of P.R.
yields on
securities. Total
cost of
deposits decreased 37 basis points to 1.79%.
On a taxable equivalent basis, the main drivers of
the increase for the third quarter of 2025 were:
higher income from investment securities and money market investments
by $17.5 million, mainly driven by higher income
from
by
$49.3
million
or
basis
points, due
to
higher
re-investment activity
at
higher yields
money market
securities by
$29.2 million
as a
the deployment
of funds
to
loan growth
and the
purchase of
securities. During
Corporation purchased
$2.5
billion
of
U.S.
notes
with
an
average duration
of
1.4
years
and
a
yield
of
3.65%, through a combination
of approximately $1.0 billion
in maturing U.S. Treasuries
and a reduction of
$1.5 billion in overnight Fed funds;
higher
income
from
loans
by
$45.6
million
driven
by
loan
growth
most
notably
in
the
construction
and
mortgage portfolios, including certain
tax-exempt loans in BPPR,
lower yields by
7 basis points,
mainly
from adjustable rate commercial and construction portfolios
due to short-term market rates decline; and
lower interest expense on
deposits by $47.6 million, or
37 basis points, when compared
to the same period
in 2024. The
cost of
interest-bearing deposits
decreased by
52 basis
points, mainly
due to
the repricing
of market-linked
P.R.
public
which
decreased
by
basis
points
to
3.19%,
and
a
in
the
cost
of
in
Popular
U.S.,
particularly in time deposits and those captured through
online channels.
Table 3 - Analysis of Levels & Yields
on a Taxable Equivalent Basis
(Non-GAAP)
Average Volume
Average Yields / Costs
Interest
Attributable to
Rate
Volume
$
5,990
$
7,033
$
(1,043)
4.43
%
5.43
%
(1.00)
%
Money market
$
66,867
$
96,061
$
(29,194)
$
(16,107)
$
(13,087)
28,957
27,569
1,388
3.42
2.92
0.50
Investment securities [1]
249,071
202,317
46,754
32,970
13,784
(2)
5.43
5.87
(0.44)
Trading securities
(45)
(31)
(14)
Total money market,
investment and
trading
34,975
34,632
3.59
3.43
0.16
316,329
298,814
17,515
16,832
Loans:
19,229
17,798
1,431
6.72
6.90
(0.18)
325,869
308,734
17,135
(7,239)
24,374
1,549
1,129
8.24
8.85
(0.61)
32,184
25,102
7,082
(1,732)
8,814
1,981
1,851
7.26
6.97
0.29
Leasing
35,957
32,241
3,716
1,378
2,338
8,484
7,911
5.96
5.73
0.23
126,352
113,409
12,943
4,523
8,420
3,257
3,211
13.80
14.08
(0.28)
113,280
112,423
(787)
1,644
3,945
3,879
9.15
8.94
0.21
Auto
91,006
87,189
3,817
2,338
1,479
38,445
35,779
2,666
7.49
7.56
(0.07)
724,648
679,098
45,550
(1,519)
47,069
$
73,420
$
70,411
$
3,009
5.63
%
5.53
%
0.10
%
Total earning assets
$
1,040,977
$
977,912
$
63,065
$
15,313
$
47,752
$
8,184
$
7,387
$
1.77
%
2.04
%
(0.27)
%
NOW and money
market
$
36,421
$
37,857
$
(1,436)
$
(4,891)
$
3,455
14,529
14,318
0.81
0.92
(0.11)
Savings
29,772
33,134
(3,362)
(3,981)
8,825
8,366
3.16
3.45
(0.29)
70,196
72,503
(2,307)
(6,096)
3,789
20,766
19,468
1,298
3.19
4.24
(1.05)
167,043
207,491
(40,448)
(52,899)
12,451
52,304
49,539
2,765
2.30
2.82
(0.52)
303,432
350,985
(47,553)
(67,867)
20,314
14,846
14,968
(122)
demand deposits
67,150
64,507
2,643
1.79
2.16
(0.37)
303,432
350,985
(47,553)
(67,867)
20,314
4.52
5.62
(1.10)
Short-term borrowings
4,616
1,430
3,186
(267)
3,453
Other medium and
(138)
5.98
5.32
0.66
long-term debt
12,096
12,560
(464)
(690)
53,521
50,590
2,931
2.37
2.87
(0.50)
liabilities (excluding
demand deposits)
320,144
364,975
(44,831)
(67,908)
23,077
Other sources of funds
5,053
4,853
$
73,420
$
70,411
$
3,009
1.73
%
2.06
%
(0.33)
%
Total source of funds
$
320,144
$
364,975
$
(44,831)
$
(67,908)
$
23,077
income on a taxable
equivalent basis (Non-
GAAP)
3.90
%
3.47
%
0.43
%
$
720,833
$
612,937
$
107,896
$
83,221
$
24,675
3.26
%
2.66
%
0.60
%
Net interest spread
Taxable equivalent
74,328
40,464
33,864
income non-taxable
equivalent basis (GAAP)
3.51
%
3.24
%
0.27
%
$
646,505
$
572,473
$
74,032
Note: The changes that are not due solely to volume or
rate are allocated to volume and rate based on the
proportion of the change in each category.
[1] Average balances exclude unrealized gains or losses
on debt securities available-for-sale and the unrealized
loss related to certain securities transferred from
available-for-sale to held-to-maturity.
Net Interest income
for the
nine-month period ended
was $1.9
billion, or $192.1
million higher than
period in 2024.
Taxable
equivalent net interest
income was $2.1
billion, an increase
of $264.6 million
when compared to
period in
- NIM
was 3.46%,
of 26
to 3.20%
in 2024.
NIM, on
a taxable
equivalent
basis, for the
nine months ended September
30, 2025 was
3.83%, an increase
of 39 basis
points compared to
the same period
of
The main drivers
of the variances
in net interest income
on a taxable equivalent
basis for the
nine-month period ended September
30, 2025 were:
higher income
from investment securities
and money market
investments by $29.3
million driven
by higher income
from
securities by
$103.2 million mainly
due to
higher yields by
47 basis
points and higher
average volume
by
$1.1 billion,
as the
Corporation continues to
re-invest U.S.
Treasury Notes
maturities at
higher yields,
as well
as use
of
funds for
the purchase
of U.S.
securities, partially
lower income
from money
by
$66.3
or
basis
points,
mainly
due
money
market
investments lower
yield
due
to
the
decline
in
market rates and the use of
funds for loan growth and investments in U.S.
Treasury securities , as discussed above;
higher income from
loans by $117.2
million resulting from
higher average balances by
$2.3 billion, reflected across
most
portfolios, most notably in the commercial, construction and mortgage loan portfolios, partially offset by lower loan yield by
three basis points driven by adjustable-rate construction
and commercial portfolios due to the decline
in market rates; and
lower deposit cost
by $124.1 million
mainly due to
the repricing of
market linked P.R.
public deposits, which
declined by
96 basis points, and the repricing of high-cost deposits
at Popular U.S.
Table 4 – Analysis of Levels & Yields
on a Taxable Equivalent Basis
from Continuing Operations (Non-GAAP)
Period ended September 30,
Average Volume
Average Yields / Costs
Interest
Attributable to
Rate
Volume
$
6,205
$
6,664
$
(459)
4.45
%
5.47
%
(1.02)
%
Money market
$
206,565
$
272,893
$
(66,328)
$
(48,483)
$
(17,845)
28,729
28,271
3.28
2.88
0.40
[1]
705,879
610,341
95,538
79,281
16,257
(1)
5.74
5.02
0.72
Trading securities
1,237
1,114
(32)
Total money market,
investment and
trading
34,963
34,965
(2)
3.49
3.38
0.11
913,681
884,348
29,333
30,953
(1,620)
Loans:
18,802
17,707
1,095
6.72
6.87
(0.15)
945,330
910,241
35,089
(20,306)
55,395
1,440
1,064
8.19
8.97
(0.78)
88,179
71,426
16,753
(6,722)
23,475
1,961
1,794
7.18
6.86
0.32
Leasing
105,650
92,292
13,358
4,501
8,857
8,331
7,818
5.89
5.67
0.22
368,141
332,626
35,515
13,125
22,390
3,224
3,209
14.10
13.94
0.16
339,880
334,818
5,062
3,058
2,004
3,935
3,820
9.00
8.86
0.14
Auto
264,905
253,511
11,394
3,760
7,634
37,693
35,412
2,281
7.49
7.52
(0.03)
2,112,085
1,994,914
117,171
(2,584)
119,755
$
72,656
$
70,377
$
2,279
5.57
%
5.46
%
0.11
%
Total earning assets
$
3,025,766
$
2,879,262
$
146,504
$
28,369
$
118,135
$
8,077
$
7,558
$
1.73
%
2.00
%
(0.27)
%
NOW and money
market
$
104,711
$
113,405
$
(8,694)
$
(14,883)
$
6,189
14,547
14,579
(32)
0.84
0.93
(0.09)
Savings
91,430
101,008
(9,578)
(9,213)
(365)
8,587
8,142
3.17
3.35
(0.18)
203,909
204,014
(105)
(11,631)
11,526
20,464
19,168
1,296
3.24
4.20
(0.96)
496,303
601,993
(105,690)
(144,853)
39,163
51,675
49,447
2,228
2.32
2.76
(0.44)
896,353
(124,067)
(180,580)
56,513
14,778
15,075
(297)
demand deposits
66,453
64,522
1,931
1.80
2.11
(0.31)
896,353
(124,067)
(180,580)
56,513
4.55
5.65
(1.10)
Short-term
11,342
3,748
7,594
(669)
8,263
Other medium and
(140)
5.79
5.18
0.61
long-term debt
36,173
37,799
(1,626)
3,875
(5,501)
52,843
50,511
2,332
2.39
2.81
(0.42)
liabilities (excluding
demand deposits)
943,868
(118,099)
(177,374)
59,275
5,035
4,791
Other sources of
funds
$
72,656
$
70,377
$
2,279
1.74
%
2.02
%
(0.28)
%
Total source of funds
$
943,868
$
$
(118,099)
$
(177,374)
$
59,275
3.83
%
3.44
%
0.39
%
income on a taxable
equivalent basis
(Non-GAAP)
$
2,081,898
$
1,817,295
$
264,603
$
205,743
$
58,860
3.18
%
2.65
%
0.53
%
Net interest spread
Taxable equivalent
198,247
125,766
72,481
3.46
%
3.20
%
0.26
%
income non-taxable
equivalent basis
(GAAP)
$
$
$
192,122
Note: The changes that are not due solely to volume or
rate are allocated to volume and rate based on the
proportion of the change in each category.
[1] Average balances exclude unrealized gains or losses
on debt securities available-for-sale and the unrealized
loss related to certain securities transferred
from available-for-sale to held-to-maturity.
Provision for Credit Losses - Loans Held-in-Portfolio
and Unfunded Commitments
For the
quarter ended September
recorded a provision
losses of $75.1
million, an
$3.7 million when compared to the same quarter of the previous
year. The provision for loan
and lease losses was $74.5 million, an
of
$1.7
and
the
for
unfunded commitments
was
$0.8
an
unfavorable variance
of
$1.3
mainly driven by higher unfunded commitments at the BPPR segment.
The provision release for HTM was $0.2 million,
of $0.6 million when compared to the same quarter
of the previous year.
As discussed
in Note
8 to
the Consolidated
Financial Statements,
estimates the
ACL by
weighting the
outputs of
optimistic,
baseline,
and
scenarios.
During
the
first
quarter
of
2025,
in
to
the
uncertainty,
the
Corporation increased the probability assigned to the pessimistic
scenario making it equal to the baseline scenario. Subsequently, in
the second quarter
of 2025, the
probability assigned to the
pessimistic scenario was moderately
reduced based on
the changes in
the economic outlook and
a reassessment of uncertainty
compared to the previous
quarter. The
net impact of these
two events on
the ACL levels for
the nine months ended September
30, 2025 was $13.7
million in additional reserves. There
were no changes to
the probability weights during the third quarter
of 2025. The probability weight for
the pessimistic scenario remains above the levels
observed in 2024, given the ongoing economic uncertainty.
The major
drivers of
the changes
in the
loan losses
quarter by
business segment
to the
same quarter in 2024, were as follows:
In the BPPR segment,
the provision for loans losses
was $72.6 million, a decrease
of $4.5 million when compared
to the
same quarter in 2024, driven by lower reserves for the consumer
portfolio of $30.6 million, mainly in auto loans and credit
cards,
due
to
improvements
in
credit
quality
and
lower
net
charge-offs.
The
favorable
variance
was
offset
by
higher
in
the
by
$21.7
million
due
to
a
specific
reserve
for
a
$158.3
million
and
industrial
facility
and
a
$13.5
million
charge-off
during
the
quarter
for
a
$30.1
million
commercial real estate facility,
both classified as NPLs during the quarter.
In the Popular
U.S. segment, the provision
for loans losses
was $1.9 million,
$6.3 million when compared
to the
same quarter
in 2024,
higher qualitative
reserves for
the commercial
portfolios, partially
offset by lower net charge-offs mainly in consumer portfolios.
For
credit
losses amounted
to
$188.1 million,
a decrease
of
$2.7
million, compared to the
nine months ended September
30, 2024. The provision
for the loan
portfolio was $189.3 million,
flat when
compared to the nine months ended September 30, 2024. The provision release related to unfunded commitments was $1.6 million,
a
of
$3.0
mainly
driven
by
the
in
unfunded commitments
within
the
U.S.
construction
portfolio.
The
provision for HTM was
$0.5 million, an increase
of $0.9 million when compared
to the same period
of the previous year.
The major
drivers of the provision for loan losses during the nine months ended September 30, 2025, by
business segment when compared to
the same period in 2024, were as follows:
In the BPPR segment, the provision for
loan losses for the nine months ended September 30,
2025 was $168.5 million, a
of
$18.3
million
when
to
the
same
period
in
2024,
driven
by
improvement
in
credit
quality
in
the
consumer portfolio, mainly in credit cards, and the stable performance of the lease portfolio for which a qualitative reserve
was established in 2024, partially offset by an increase in provisions for the
mortgage portfolio, driven by lower recoveries
and changes in macroeconomic forecasts and credit
quality.
In
the
Popular
U.S.
segment,
the
for
loan
losses
was
$20.8
an
of
$18.2
driven
by
changes
in
credit
quality
within
the
offset
by
lower
net
charge-offs
within
the
portfolios.
At
total
allowance for
credit
losses for
loans held-in-portfolio
$786.2 million,
$746.0
million
as
of
31,
The
ratio
of
the
for
credit
losses
to
loans
was
2.03%
at
30,
to
2.01%
at
- Refer
to
Note
to
the
for
additional information
on the
Corporation’s methodology
to
estimate its
ACL. Refer
to the
Credit Risk
section of
this MD&A
for
a
detailed analysis of net charge-offs, non-performing assets,
the allowance for credit losses and selected loan
losses statistics.
Non-Interest Income
amounted to $171.2
million for
2025, an
$7.1 million
when compared with
the
same quarter for the previous year. This variance was primarily due
to:
higher gains from equity securities by $2.7 million mainly due to the valuation of securities held for deferred compensation
plans, which have an offsetting effect on personnel cost;
higher other
service fees
by
$2.6 million
to
card fee
$3.3 million,
due to
higher
volume
of
costumer
transactions,
and
higher
fees
by
$1.1
driven
by
a
higher
assets under management, partially offset by lower insurance
fees by $2.4 million; and
higher other operating income by $2.1 million mainly
due to income of $5.3 million related to
a retroactive charge billed to
a tenant
for energy
supplied in
prior years
investments accounted
equity method
by
$4.1 million, partially offset
by lower daily car
rental revenue by $5.0 million
and gains from the sale
of car rental units
by
$1.4 million, associated with the car rental business
sold in the fourth quarter of 2024;
Non-interest income amounted
to $491.7
million for
a decrease of
$2.5 million when
compared to the same period of the previous
year. The main factors that contributed to the variance were:
lower other operating income by $13.6 million mainly due to lower daily car rental revenue by $14.9 million and gains from
the sale
of car
rental units
by $7.7
million
associated with
the car
rental business sold in
the fourth quarter of
2024, partially offset by
income of $5.3 million
related to a retroactive
charge
billed to
a tenant
for energy
supplied in
prior years
and $3.3
million of
income related
to the
reimbursement of
excess
interest paid
to the
U.S. Internal
Revenue Service
(the “IRS”)
for late
payment penalties
tax withholdings
on
intercompany distributions for the years 2014-2024 as
disclosed in 2024; and
lower mortgage
banking activities
by
$1.4 million
to
a decrease
in mortgage
servicing fees
due to
runoff;
higher other
service fees
by $6.5
to
card fee
$7.3 million,
due to
higher
volume of
transactions, higher
investment management
fees by
$3.8 million,
due to
higher assets
under management,
and higher merchant membership fees by $1.2
million, partially offset by lower insurance fees by
$6.5 million;
higher
service
charges
on
deposit
accounts
by
$3.7
million
mainly
due
to
higher
non-balance
compensation
fees
in
commercial deposits; and
an impairment on equity securities of $2.3
million recognized during 2024.
Operating Expenses
Operating
to
$495.3
million
for
the
quarter
ended
30,
2025,
an
of
$28.0
million
when
compared with the same quarter of 2024. The
variance in operating expenses was mainly driven
by:
higher personnel costs by $31.1 million mainly due to higher incentives, including $13.0 million related to the profit-sharing
plan
which is tied to the Corporation’s financial performance and $9.0 million in other performance-based incentives, higher salaries
expense by $3.4 million, due to
a higher headcount and annual merit increases, and a
$3.4 million increase in other personnel
costs mainly
the valuation
of securities
held for
deferred compensation
plans,
higher payroll
taxes, and
employee
termination benefits resulting from ongoing
efforts to improve our
profitability, including the
decision to exit the
U.S. residential
mortgage origination business and close four underperforming
branches in the New York metro area at Popular U.S.;
a
non-cash
of
$13.0
million
in
our
U.S.
based
equipment
leasing
subsidiary
due
to
lower
projected
earnings for the forecasted period; and
higher processing
and transactional
services expenses
by $4.1
due to
card processing
expense as a result of higher transactional volumes;
lower other operating expenses
by $12.9 million mainly
driven by a reversal
in the third
quarter of 2025 of
a $4.8 million claim
reserve established
second quarter
of 2025
and lower
accruals for
reserves for
operational losses
by $4.1
million
mainly related to the mortgage servicing business; and
lower equipment expenses by $4.0 million, mainly due to
the elimination of the car rental fleet
depreciation expense, related to
the car rental business sold in 2024.
Operating expenses
$1.5 billion
for the
of $39.1
million when
compared with the same
period of 2024. Excluding the
$6.4 million interest accrued related
to prior period tax
withholdings and the
$14.3
million
impact
of
the
FDIC
Special
Assessment
in
2024,
total
for
the
nine
months
ended
2025, increased
by $59.7
million, when
compared with
period of
main drivers
of the
were:
higher personnel costs by $60.4 million mainly due to higher incentives, including $26.0 million related to the profit-sharing
plan
which
is
tied
to
the
and
$18.3
million
in
other
performance-based
higher
salaries expenses
by $9.1
to a
higher headcount
and annual merit
increases and a
$5.7 million
other
personnel costs mainly related to the valuation of
securities held for deferred compensation plans and
higher payroll taxes;
a non-cash goodwill impairment of $13.0 million
in our U.S. based equipment leasing subsidiary
as discussed above;
higher other taxes expense by $7.9
million mainly due to higher regulatory fees
and an increase in municipal license tax in
Puerto Rico;
higher technology
and software
expenses,
including software
cost amortization,
by $7.8
million related
to investments
in the
Corporation’s cloud infrastructure, among other continuing investments
in technology and transformation initiatives;
higher
processing
and
by
$6.4
million
mainly
due
to
higher
credit
and
debit
card
and
merchant processing expenses as a result of higher
transactional volumes; and
higher business
promotion expenses
by $5.3
due to
higher customer
rewards programs
expense in
our credit
card business;
lower other
operating expenses
by $17.3
driven by,
lower accruals
for reserves
for operational
$9.7
million and lower pension plan cost by $3.3
million due to changes in actuarial assumptions;
lower professional fees by $12.6 million mainly due
to lower costs associated with regulatory compliance
activities; and
lower equipment expenses by $12.2 million, mainly due to the depreciation of car rental units during 2024 associated with units
sold as part of the daily car rental transaction during
the fourth quarter of 2024.
Table 5 - Operating Expenses
Personnel costs:
Salaries
$
139,350
$
135,983
$
3,367
$
403,052
$
394,001
$
9,051
Commissions, incentives, and other bonuses
35,309
26,350
8,959
113,846
95,587
18,259
Profit sharing
13,000
13,000
26,000
26,000
Pension, postretirement, and medical insurance
18,749
16,387
2,362
51,773
50,391
1,382
Other personnel costs, including payroll taxes
26,580
23,136
3,444
80,385
74,678
5,707
Total personnel
costs
232,988
201,856
31,132
675,056
614,657
60,399
Net occupancy expenses
26,083
28,031
(1,948)
82,441
83,764
(1,323)
Equipment expenses
5,313
9,349
(4,036)
16,404
28,578
(12,174)
Other taxes
17,967
17,757
55,324
47,465
7,859
25,808
26,708
(900)
80,741
93,370
(12,629)
87,117
88,452
(1,335)
255,481
247,666
7,815
Processing and transactional services:
Credit and debit cards
14,728
11,761
2,967
40,698
37,644
3,054
Other processing and transactional services
23,680
22,559
1,121
73,352
69,966
3,386
Total processing
and transactional services
38,408
34,320
4,088
114,050
107,610
6,440
Communications
4,836
5,229
(393)
14,750
14,143
Business promotion:
Rewards and customer loyalty programs
17,656
16,533
1,123
52,068
46,995
5,073
Other business promotion
9,648
9,104
25,296
25,080
Total business
promotion
27,304
25,637
1,667
77,364
72,075
5,289
Deposit insurance
10,873
10,433
30,315
44,901
(14,586)
Other real estate owned (OREO) income
(3,408)
(2,674)
(734)
(10,862)
(13,745)
2,883
Other operating expenses:
Operational losses
1,634
5,769
(4,135)
13,957
21,153
(7,196)
All other
6,980
15,750
(8,770)
39,673
56,140
(16,467)
Total other operating
8,614
21,519
(12,905)
53,630
77,293
(23,663)
(320)
1,366
2,233
(867)
Goodwill impairment
13,000
13,000
13,000
13,000
$
495,287
$
467,321
$
27,966
$
$
$
39,050
Income Taxes
For the quarter and nine months
ended September 30, 2025, the Corporation recorded an income
tax expense of $36.0 million and
$128.9
with an
effective
tax
rate
(“ETR”) of
14.5%
and
17.7%, respectively,
$42.5 million
and
$138.5 million, respectively, with an ETR of 21.5% and 24.1% for the respective
periods of year 2024.
The lower income tax expense of $6.5 million for
the third quarter, when compared to
the same quarter of 2024, is mainly attributed
to the
higher net
exempt income.
For the
nine-months period
the lower
expense of
$9.6
million
reflects
the
impact
of
the
tax
withholding
expense
of
$22.9
million
during
the
first
quarter
of
year
2024,
in
connection with intercompany distributions for years
2014-2024, as disclosed in Note 34 to the Consolidated
Financial Statements in
the
Form
10-K,
and
the
$5.2 million
related
to
the FDIC
Special
Assessment expense;
excluding this
combined
impact, the adjusted increase of $8.1 million was
due to higher income before tax, net of higher
exempt income.
30, 2025, the
Corporation had a
net deferred tax
asset amounting to
$835.5 million, net
of a
valuation allowance of
$465.0 million. The net
deferred tax asset related
to the U.S. operations
was $238.5 million, net
of a valuation allowance
of $386.9
Upon an
amendment to
Rico internal
revenue code
of
Corporation elected
to
treat
certain single members
LLCs as disregarded entities,
as allowed by
this amendment, on
its 2024 corporate income
tax return filed
subsequent to the quarter
end in October.
It is expected that
this election will lower
our income tax expense
by approximately $7.7
million during the fourth quarter of 2025.
Refer to
Note 26
to the
a reconciliation
of the
statutory income
tax rate
to the
effective tax
rate and additional information on the income
tax expense and deferred tax asset balances.
REPORTABLE SEGMENT RESULTS
reportable segments
for managerial
reporting purposes
consist of
Banco Popular
de Puerto
Rico and
Popular
U.S. A Corporate group
has also been defined to support the reportable
segments.
For
a
description
of
the
segments,
and
the
management accounting process, refer to Note 28
The corporate group reported
a net income of
$4.6 million for the
2025, compared with a
of $0.5 million for the same quarter of
the previous year, mainly due to
higher income from equity method investments.
For the nine
months ended September 30, 2025, the corporate group reported net income of $4.3 million, compared to a net loss of $21.1 million
for
the
same
period
of
the
year.
The
loss
in
was
mainly
attributable
to
the
expense
related
to
the
$22.9
million
adjustment recorded in
of 2024 to
recognize the tax
impact associated with
prior period intercompany
and
the
$6.5
million
expense
for
the
tax
impact
of
intercompany
paid
during
the
first
quarter
of
A
positive adjustment
of $3.9
million was
recorded during
2025, resulting
from reimbursements
received from
the IRS
interest paid
for these
intercompany distributions.
There were
no intercompany
distributions between
subsidiaries and
the
bank holding
companies during
- Higher
equity method
lower expenses,
driven by
professional services, also
contributed to the
positive variance for
the nine months,
lower income from
money market investments due to a decrease in rates.
Highlights on the earnings results for the reportable
segments are discussed below:
The Banco Popular
de Puerto Rico
reportable segment’s net
income amounted to
$189.0 million for
the quarter ended
30, 2025, compared with a net income of $125.8 million for the same
quarter of the previous year. The factors that contributed to the
variance in the financial results included the following:
income of $550.7
million was higher
by $62.7
million primarily driven
by lower interest
expense on deposits,
mainly from the
re-pricing of P.R.
public funds which are
market-linked,
higher income from U.S.
Treasury securities with
higher yields and higher income from the loan portfolio driven by loan growth, partially offset by
lower income from money
due to
decline in
short-term market
rates. The
margin for
30, 2025 was
3.71%, an increase
of 30
basis points, compared
to 3.41% for
the same quarter
in the previous
year. The
the margin
was mainly
impacted by
lower deposit
costs and
higher yield
from investment
securities, as
well
loan growth,
partially offset by lower rates on money market investments;
the provision for
loan losses of
$72.7 million was
lower by $4.5
million mainly driven by
lower reserves for the
loan
due
to
improvements in
credit
quality,
offset
by
a
higher
in
the
mainly attributable to reserves for two unrelated exposures with an aggregate balance of 188.4 million, which entered into
NPL status during the third quarter of 2025;
higher non-interest income by $1.6 million mainly due to higher service fees by $2.7 million mainly due to higher debit and
credit fees due to higher
volume of transactions and higher assets
under management, the income of $5.3 million
related
to a retroactive charge billed to a tenant for energy supplied in prior years, partially offset by lower daily car rental revenue
by $5.0 million
and gains from
the sale of
car rental units
by $1.4 million,
associated with the
car rental business
sold in
the fourth quarter of 2024;
higher operating expenses by $9.2
million mostly due to higher
personnel costs by $21.0 million, mainly
due to the profit-
sharing
expense
accrual
and
other
performance-related
and
higher
processing
and
fees
expenses by
$4.0 million,
lower operational
$6.2 million,
mainly related
to mortgage
servicing, lower
occupancy
expense
by
$4.3
million
driven
by
a
favorable
reassessment
of
the
real
tax
for
certain
properties in
and lower
equipment expenses
by $3.7
the daily
car rental
sold in the fourth quarter of 2024; and
lower income tax expense by $4.0 million due
mainly to higher exempt income.
For
the
30,
recorded net
income
of
$539.5 million
to
a
net
income of $404.3 million for the same period of the previous year. The factors that contributed to the variance in the financial results
included the following:
income of
$1.6
billion was
higher by
$161.5 million
primarily driven
interest expense
on deposits,
mainly from the re-pricing of P.R.
public funds, higher income from investment securities,
mainly U.S. Treasury securities,
loans due
to portfolio
growth, partially
lower income
from money
reflecting the decline in short-term market rates. The
net interest margin for the nine months
ending September 30, 2025,
was 3.66%, 28 basis
points higher when compared
with 3.38% for the same
period of the previous
year. The
the
margin
was
mainly
by
lower
cost
of
mainly
P.R.
public
higher
yield
from
securities and
loan growth,
rates from
money market
lower balances
as funds
are deployed for loan growth and purchasing U.S.
Treasury securities;
the
loan
losses
of
$168.6
million
was
lower
by
$18.2
million
mainly
attributable to
improvement in
credit
quality for the
credit cards portfolios,
lower balance of
personal loans and
lower reserves in
the leases portfolio,
offset
by
an
in
the
expense
for
the
driven
by
lower
net
recoveries,
changes
in
macroeconomic forecasts, and changes in credit quality;
lower non-interest
$13.3 million
to lower
daily car
rental revenue
by $14.9
million and
gains from
the
sale
of
car
rental
units
by
$7.7
million
with
the
car
rental
business sold
in
the
fourth
quarter
of
2024,
partially offset by the above mentioned retroactive
income of $5.3 million, higher service fees by
$4.1 million due to credit
and debit card income,
from higher volume of
transactions and, higher investment management fees
and higher charges
on deposit accounts by $3.3 million mainly due
to non-balance compensation in commercial deposits;
higher operating expenses by $28.3 million
mostly due to higher personnel costs
by $38.3 million, including profit sharing
expense
by
$21.2
million
and
higher
salaries
expense
by
$15.5
million
due
to
annual
merit
and
a
higher
headcount, higher regulatory
examination fees, municipal
license tax and
higher technology expenses,
lower equipment
expenses related
to
the daily
rental business
sold
and
lower FDIC
expense due
to
the FDIC
Special
Assessment recorded in 2024; and
higher income tax expense by $4.0 million mainly
due to higher income before tax, net of higher
tax exempt income.
For the quarter ended September 30, 2025, the reportable
segment of Popular U.S. reported a net income
of $17.8 million,
compared with a net income of $28.8 million
for the same quarter of the previous year. The factors that contributed
to the variance in
the financial results included the following:
net interest income of $105.2 million, higher
by $12.1 million due to higher income from
loans by $16.5 million, mainly
from growth in the commercial and construction portfolios,
and lower cost of deposits by $9.3 million due
to the repricing
of high-cost deposits, partially offset by lower income
from money market investments due to lower average
balances and
lower yields reflecting the decrease in short-term
rates. The net interest margin for the quarter
ended September 30, 2025
was 2.94% compared to 2.73% for the same quarter
in the previous year driven by lower
cost of deposits;
the provision for loan losses was $1.9 million,
reflecting a higher provision for the commercial
portfolio, offset by lower
provision for the consumer portfolio, compared to a release
of $6.1 million in 2024, which was mainly
improvements in commercial credit quality;
higher operating expenses by $19.0 million, reflecting
the goodwill impairment charge related to our U.S.
based
equipment leasing subsidiary of $13.0 million recorded
during the third quarter of 2025, higher personnel
costs driven by
incentives and profit sharing; and higher occupancy
expense; and
lower income tax expense by $3.7 million due
to lower income before tax.
For the nine months ended September 30, 2025,
the reportable segment of Popular U.S. recorded
net income of $55.2 million,
compared with net income of $53.6 million for
the same period of the previous year. The factors that contributed to
the variance in
the financial results included the following:
higher net interest income by $36.5 million
due to higher income from the loans portfolio
mainly related to growth in the
commercial and construction portfolios and lower interest
expense from deposits, due to the repricing of
high-cost
deposits mentioned above, partially offset by lower income
from money market investments due to decline in
market rates. The net interest margin for the nine
months ended September 30, 2025 was 2.87%
compared to 2.64% for
the same period of the previous year driven by
lower cost of deposits;
the provision for loan losses of $20.8 million was
higher by $18.2 million driven by higher
qualitative reserves and
changes in credit quality for the commercial real estate
portfolio, partially offset by lower reserves for
the consumer loans;
higher operating expenses by $17.4 million reflecting
the goodwill impairment charge related to our U.S.
based equipment
leasing subsidiary of $13.0 million recorded in 2025;
and higher personnel costs and consulting fees;
offset by lower FDIC
expense due to FDIC Special Assessment recorded
in 2024 and lower professional fees; and
higher income tax expense by $0.8 million due
to higher income before tax.
STATEMENT
OF FINANCIAL CONDITION ANALYSIS
Assets
The
Corporation’s total
assets were
$75.1
billion at
to
$73.0 billion
at
variance in
total assets
of $2.1
billion was
driven by
in AFS
securities and
loan growth
across most
portfolios at
both
BPPR and PB segments,
partially offset by a decrease in money market investments, HTM securities,
and other assets. Refer to the
Consolidated Statements of Financial Condition included
in this report and to the following narrative
for additional information.
Money market investments and investment securities
Money market investments decreased by
$1.6 billion as of
September 30, 2025, when
compared to December 31,
2024, driven by
funds used for loan growth and to purchase U.S. Treasury securities.
AFS securities increased $2.4 billion, mainly due to investment
in
U.S.
and
the
in
the
losses
of
AFS
of
$338.6
offset
by
and
paydowns.
HTM
decreased
by
$324.9
million
driven
by
and
paydowns,
by the
amortization of
$138.7 million
of the
discount related
to U.S.
Treasury securities
previously reclassified from
the AFS to
HTM.
Refer to Note
5 and to
Note 6 to
the Consolidated Financial Statements
for additional information
with respect to
the Corporation’s debt securities available-for-sale and held-to-maturity.
Loans
Refer to Table
6 for a
breakdown of the Corporation’s
loan portfolio. Also, refer
to Note 7 in
the Consolidated Financial Statements
for detailed information about the Corporation’s loan portfolio
composition and loan purchases and sales.
increased by
$1.6
billion to
$38.7 billion
- In
the
BPPR
segment
loan
balances increased
by
$982.8
million
across most
portfolios, most
notably in
the
commercial, construction,
mortgage, auto
loans and leasing
portfolios. Commercial loans
the origination
of a
$265.0 million commercial
loan during
2025, which
represents the
Corporation’s portion
of a
$425.0 million
issuance in
which BPPR
acted as
the
lead bank
and administrative
agent.
Origination activity
supported the
growth in
the mortgage,
auto loans,
and leasing
portfolios,
despite the uncertainty about the
economic outlook which may continue
to have an impact
on customer behavior.
The PB segment
also increased
by $596.7 million, mainly driven by commercial and
construction lending.
loans to
non-depository financial
institutions (‘’NDFIs’’)
$443.6 million,
an
increase of $48.8 million,
compared to December 31,
- The increase was
mainly related to a
loan to an insurance
company in
Puerto
Rico
for
general
corporate
purposes,
offset
by
a
in
other
exposures,
mainly
to
intermediaries.
At
Corporation’s exposure to NDFIs
was composed of approximately $272.4
million to insurance companies
for
general corporate
purposes
unrelated to
lending activities,
$85.6 million
related
to
mortgage credit
intermediaries, and
$85.6
million to consumer
and commercial credit
intermediaries. All loans
to NDFIs are
current in their
contractual payments and
carry a
‘pass’ rating.
Table 6 - Loans Ending Balances
Loans held-in-portfolio:
$
$
$
89,969
99,345
(67,022)
504,077
626,369
340,820
444,225
Leasing
73,246
7,488
78,890
73,571
5,319
45,081
Auto
27,516
Other
181,220
171,778
9,442
94,846
Total loans held-in
-portfolio
$
$
$
1,579,506
Loans held-for-sale:
$
7,783
$
5,423
$
2,360
Total loans held-for-sale
$
7,783
$
5,423
$
2,360
$
$
$
1,581,866
Other
assets
to
$1.7
billion
at
30,
2025,
a
of
$52.9
million
when
to
$1.8
billion
at
variance was
by a
decrease in
net deferred
of $89.0
to a
positive
variance
in
the
valuation
of
AFS
a
in
unsettled
trade
receivables
of
$13.8
million
related
to
proceeds
from
maturities of U.S. Treasury securities,
and lower principal, interest and escrow servicing advances of $12.6 million, partially offset by
an increase in capitalized software
costs of $45.8 million
mainly related to technology modernization,
higher prepaid taxes of
$11.5
million, and higher trades receivable from brokers and counterparties of
$9.1 million. Refer to Note 10 to
the Consolidated Financial
Statements for a breakdown
of the principal categories
that comprise the caption
of “Other Assets” in
the Consolidated Statements
of Financial Condition at September 30, 2025 and December
The Corporation’s total liabilities were $69.0 billion at September 30, 2025, an increase of $1.5 billion, when compared to December
31, 2024. The following is a discussion of
the significant changes in liabilities.
Deposits and Borrowings
Total Deposits
deposits totaled
$66.5 billion
as of
to
$64.9 billion
as
of
Ending
deposit
increased
by
$1.6
billion,
while
average
grew
by
$2.9
The
average
deposit
balance, excluding
P.R.
increased by
$1.5
billion. Non-interest-bearing
deposits remained
flat when
December 31, 2024, demonstrating the impact of the Corporation’s
continued focus on deposit retention strategies.
At the end of the
third quarter of 2025, Puerto Rico public deposits were $20.1 billion, an increase of $612.7 million when compared to
- P.R
represent 30%
of total
deposits and
are expected
to continue
to
range in
the short
term
between $18
billion
and
$20
However,
the
rate
at
which
public
deposit balances
may
change
is
uncertain and
difficult
to
predict.
The
amount and timing of any such change is likely to be impacted by,
for example, the level of federal assistance and speed at which it
is
distributed,
the
use
of
local
funds
to
cover
federal
assistance
programs
during
the
U.S.
shutdown,
the
condition, liquidity and cash management practices of the Puerto Rico Government and its instrumentalities,
and the implementation
of
fiscal
and
debt
plans
approved
pursuant
to
PROMESA
or
other
actions
mandated
by
the
Fiscal
and
Management Board for Puerto Rico (the “Oversight Board”). Additionally, the Trump
Administration is conducting a review of federal
funding, which could entail
a reduction in federal
funding available for Puerto
Rico. P.R
public deposits costs are
generally indexed
to changes in short-term market rates with a
one-quarter lag, in accordance with contractual
terms. As a result, these deposits’ costs
have typically lagged variable asset repricing. These deposits require
that the bank pledge high credit quality securities as collateral;
therefore, liquidity risks arising from deposit outflows
are lower.
At BPPR,
excluding Puerto
Rico public
deposits, ending
deposits increased
by $178
million, while
at PB
segment ending
deposit
balances increased by $616 million, net of intercompany
activity.
The volume and cost of P.R.
public deposits and the proportion of high-cost deposits in the U.S, directly impact the balance and mix
of earning assets and therefore represent a key
factor in the Corporation’s ability to expand its net
interest margin.
Refer to Table 7 for a breakdown of the Corporation’s deposits at September 30, 2025 and
Table 7 - Deposits Ending Balances
Deposits excluding P.R.
public deposits:
$
$
$
(265,529)
Savings, NOW and money market deposits (non-brokered)
21,739,958
21,177,506
562,452
Savings, NOW and money market deposits (brokered)
883,471
736,225
147,246
Time deposits (non-brokered)
8,014,080
7,476,924
537,156
Time deposits (brokered CDs)
925,761
890,704
35,057
Sub-total deposits excluding P.R.
46,437,296
45,420,914
1,016,382
[1]
12,487,246
11,730,273
756,973
Savings, NOW and money market deposits (non-brokered)
6,907,309
7,087,904
(180,595)
Time deposits (non-brokered)
681,553
645,254
36,299
Sub-total P.R.
20,076,108
19,463,431
612,677
$
$
$
1,629,059
[1] Includes interest bearing demand deposits.
The Corporation’s borrowings totaled $1.2
billion at September 30, 2025
an increase of $70.7 million
when compared to December
31,
The
was
mainly
related
to
higher
FHLB
by
$67.6
mainly
at
PB.
Refer
to
Note
to
the
detailed information
on the
Corporation’s borrowings.
Also, refer
to the
Liquidity section
in
this MD&A for additional information on the Corporation’s
funding sources.
Stockholders’ Equity
totaled $6.1
billion
of
$502.6 million
to
- The increase was principally due to net income
for the nine months ended September 30, 2025 of $599.3
million, coupled with
the after-tax effect of the decrease in net unrealized losses in the portfolio of AFS securities
of $283.4 million and the amortization of
unrealized losses from securities previously reclassified to
HTM of $
.0 million, partially offset by
an increase in treasury stock of
$346.0 million, mainly due to common stock repurchases and the common and preferred dividends declared of $147.7
million. Refer
to the Consolidated Statements of Financial Condition, Comprehensive Income and Changes in Stockholders’ Equity for information
on the composition of stockholders’ equity.
During
the
quarter
and
nine
months
ended
30,
2025,
Popular
repurchased
shares
of
common
stock
for
$119.4
price of
$119.33
and 3,407,821
for $353.7
price of
$103.78 per share
respectively, as
part of the
2024 and 2025
common stock repurchase
programs previously announced.
As of September 30, 2025, $429.0 million remained
available for stock repurchase under the active
repurchase authorization.
During
the
third
quarter
of
2025,
the
a
common
stock
dividend
of
$0.75
per
share,
an
from
the
common stock dividend of $0.70 per share.
The composition of the Corporation’s financing to total assets
at September 30, 2025 and December 31,
2024 is included in Table 8.
Table 8 - Financing to Total
Assets
% (decrease) increase
% of total assets
(Dollars in millions)
from 2024 to 2025
Non-interest-bearing core deposits
$
14,874
$
15,139
(1.8)
%
19.8
%
20.7
%
Interest-bearing core deposits
46,020
44,622
3.1
61.3
61.1
Interest-bearing other deposits
5,619
5,123
9.7
7.5
7.0
Repurchase agreements
3.6
0.1
0.1
77.8
0.5
0.3
(11.8)
1.1
1.2
1,190
1,372
(13.3)
1.6
1.9
6,116
5,613
9.0
8.1
7.7
CAPITAL
Regulatory Capital
The Corporation, BPPR and PB
are subject to regulatory capital
requirements established by the Federal Reserve Board.
The risk-
based
capital
standards
to
the
Corporation,
BPPR
and
PB
(“Basel
III
capital
rules”)
are
based
on
the
final
capital
framework for strengthening international capital standards, known
as Basel III, of the Basel Committee on Banking Supervision.
As
2025, the Corporation’s,
BPPR’s and PB’s
capital ratios continue
to exceed the
minimum requirements for being
“well-capitalized”.
The risk-based
capital ratios
presented in
Table
9,
which include
common equity
tier 1,
Tier
1 capital,
total capital
and leverage
capital as of September 30, 2025 and December
Table 9 - Capital Adequacy
Data
Common equity tier 1 capital:
Common stockholders' equity - U.S. GAAP basis
$
6,093,529
$
5,590,923
CECL transitional amount
[1]
42,375
AOCI related adjustments due to opt-out election
1,191,224
1,589,875
Goodwill, net of associated deferred tax liability (DTL)
(641,809)
(657,181)
Intangible assets, net of associated DTLs
(5,460)
(6,826)
Deferred tax assets and other deductions
(223,648)
(296,374)
Common equity tier 1 capital
$
6,413,836
$
6,262,792
Additional tier 1 capital:
22,143
22,143
Additional tier 1 capital
$
22,143
$
22,143
Tier 1 capital
$
6,435,979
$
6,284,935
Tier 2 capital:
Trust preferred securities subject to phase in as
tier 2
192,674
192,674
Other inclusions (deductions), net
511,230
490,594
Tier 2 capital
$
703,904
$
683,268
Total risk-based capital
$
7,139,883
$
6,968,203
Minimum total capital requirement to be well capitalized
$
4,062,200
$
3,907,346
Excess total capital over minimum well capitalized
$
3,077,683
$
3,060,857
Total risk-weighted
assets
$
40,621,998
$
39,073,462
Total assets for leverage
ratio
$
75,897,616
$
72,593,464
Risk-based capital ratios:
Common equity tier 1 capital
15.79
%
16.03
%
Tier 1 capital
15.84
16.08
Total capital
17.58
17.83
Tier 1 leverage
8.48
8.66
[1] The CECL transitional amount includes the impact
of Popular's adoption of the new CECL accounting standard
on January 1, 2020.
The Basel
III capital rules
provide that a
depository institution is
deemed to be
well capitalized if
it maintains a
leverage ratio of
at
least 5%,
a common equity
Tier 1
ratio of
at least 6.5%,
a Tier
1 capital ratio
of at least
8% and a
total risk-based
ratio of at
least
10%.
The
Corporation,
BPPR
and
PB
leverage
ratio,
common
equity
Tier
ratio
and
Tier
capital
ratio,
respectively
as
of
September 30, 2025, continue to exceed the minimum
requirements for being “well-capitalized” under
the Basel III capital rules.
Pursuant
to
the
of
the
CECL
standard
on
January
1,
2020,
the
elected
to
use
the
five-year
transition
period option
as
provided in
the
final
interim
regulatory capital
rules effective
March 31,
The
five-year
transition
period provision delayed for two years the estimated impact of CECL on regulatory capital, followed by a three-year transition period
to phase out
the aggregate amount of
the capital benefit provided
during the initial two-year
delay. During
of 2025,
the Corporation phased-in all the cumulative CECL
deferral over the three-year transition period.
The decrease in the common equity Tier
I capital ratio, Tier
I capital ratio, total capital ratio,
and leverage ratio as of September 30,
2025 as compared to December 31, 2024 was mainly due to the repurchase of common stock, common stock dividends,
risk
assets
driven
by
the
in
loans
and
higher
loans
held-in-portfolio,
offset by the nine-month period’s earnings.
Reconciliation to Tangible Common Equity and Tangible Assets
Table
10 provides
a reconciliation of
total stockholders’ equity
to tangible common
equity and total
assets to tangible
assets as
of
September 30, 2025, and December 31, 2024.
Table 10 - Reconciliation
of Tangible Common Equity
and Tangible Assets
(In thousands, except share or per share information)
Total stockholders’
equity
$
$
Less: Preferred stock
(789,954)
(802,954)
(5,460)
(6,826)
Total tangible common
equity
$
5,298,115
$
4,781,143
$
$
(789,954)
(802,954)
(5,460)
(6,826)
Total tangible assets
$
74,270,384
$
72,235,603
Tangible common
equity to tangible assets
7.13
%
6.62
%
Common shares outstanding at end of period
70,141,291
Tangible book value
per common share
$
79.12
$
68.16
Quarterly average
Total stockholders’
equity [1]
$
6,943,541
$
6,620,766
Average unrealized (gains) losses on AFS securities
transferred to HTM
296,934
505,791
Adjusted total stockholder's equity
7,240,475
7,126,557
Less: Preferred Stock
(802,812)
(804,411)
(5,714)
(7,288)
Total tangible common
equity
$
6,409,806
$
6,292,715
Return on average tangible common equity
13.06
%
11.22
%
[1] Average balances exclude unrealized gains or
losses on debt securities available-for-sale.
RISK MANAGEMENT
Market / Interest Rate Risk
The Corporation’s assets that are mainly subject to market valuation risk are debt securities classified as available-for-sale. Refer to
Notes 5 and 6 to
the Consolidated Financial Statements for further information on
the debt securities available-for-sale and held-to-
maturity portfolios.
Debt securities
available-for-sale and
held-to-maturity amounted
to
$20.7 billion
and
$7.4 billion,
as of September
30, 2025. Other
assets subject to
market risk include
mortgage servicing rights
("MSRs") with a
fair
value of $99.5 million as of September 30, 2025.
Interest Rate Risk (“IRR”)
The Corporation’s net interest income is subject
to various categories of interest rate risk,
including repricing, basis, yield curve and
option risks.
In managing
interest rate
risk, management may
alter the
mix of
floating and
fixed rate
liabilities, change
pricing
schedules,
adjust
through
sales
and
of
and
enter
into
derivative
contracts,
among other alternatives.
Management utilizes various tools to assess IRR, including Net Interest
Income (“NII”) simulation modeling, static gap analysis, and
Economic Value of Equity (“EVE”) to monitor the risk arising from the dynamic characteristics of assets and liabilities subject to
IRR.
The
three
methodologies complement
each
other
and
are
used jointly
in
the
evaluation of
the
Corporation’s IRR.
NII simulation
modeling, by legal entity and on a consolidated basis, is prepared for a five-year period, which in conjunction
with the EVE analysis,
provides management a better view of long-term
IRR.
The Corporation processes NII
simulations under interest rate
scenarios in which the
yield curve is assumed
to rise and
decline by
the same magnitude
(parallel shifts). The
rate scenarios considered in
these market risk
simulations include instantaneous parallel
changes of
-100,
-200, +100,
and +200
succeeding twelve-month
period. Assumptions
these
analyses
include
that
the
balance
sheet
remains
flat,
relative
levels
of
market
rates
across
all
yield
curve
points
and
indexes, interest rate spreads, loan
prepayments and deposit elasticity.
Thus, they should not be
relied upon as indicative of
actual
results
and
do
not
contemplate
actions
that
may
engage
in
as
a
to
future
changes
in
rates.
is also
the risk
inherent in
the use
of different
rate indexes
for the
repricing of
liabilities, as well the
risk of pricing lags
due to contractual or
timing differences between the
market and management response
to
changes
in
the
rate
environment.
These
forward-looking
computations
are
best
based
on
known
and
available information and actual results may differ.
The
table
the
results
of
the
simulations
at
30,
and
31,
2024,
assuming
a
static
balance sheet and parallel changes over flat spot rates
over a one-year time horizon:
Table 11
- Net Interest Income Sensitivity (One Year
Projection)
Amount Change
Percent Change
Amount Change
Percent Change
Change in interest rate
+200 basis points
(10,760)
(0.41)
44,747
1.78
+100 basis points
(6,125)
(0.23)
22,917
0.91
-100 basis points
2,953
0.11
9,157
0.36
-200 basis points
17,319
0.66
0.02
As
of
30,
2025,
NII
simulations
showed
a
shift
in
the
sensitivity
to
become
sensitive.
Compared to the results as of December 31, 2024, the variation in sensitivity and the resulting profile was mainly due to an increase
in asset
duration driven
by the
extension of
Notes and
a decline
in U.S.
Treasury Bills
and excess
reserves at
the
FRB as
part of
a decision
to reduce
sensitivity to
declining rate
scenarios. In
rising rate
scenarios, Popular’s
income
would decrease
due to
the lower
volume of
short-term assets
as a
the investment
portfolio extension strategy
combined
with higher deposits costs due to BPPR’s large proportion of market-linked Puerto
Rico public sector deposits, this would be partially
variable rate
loan repricing
and intermediate
maturity assets
coming due
within one
year.
Changes in
the balance
sheet
during the quarter
that contributed to
the variance in
sensitivity include the
purchase of $2.5
billion in U.S.
Treasury Notes
with an
average maturity of approximately 1.4 years, in addition
to higher fixed rate loan balances.
The
loan
and
are
subject
to
prepayment
risk.
Prepayment
risk
also
could
have
a
impact on the duration of mortgage-backed securities
and collateralized mortgage obligations.
Trading
engages in
trading activities
in the
at its
subsidiaries, BPPR
and Popular
Securities.
Popular Securities’
trading activities
consist primarily
of market-making
activities to
meet expected
customers’ needs
its
retail brokerage business, and purchases and sales of
U.S. Government and government sponsored securities with the objective of
realizing gains
from expected
short-term price
movements. BPPR’s
trading activities consist
primarily of
holding U.S.
sponsored
and
hedges
of
the
related
market
risk
with
“TBA”
(to-be-announced)
market
transactions. In
addition, BPPR
uses forward
contracts or
TBAs that
have characteristics
similar to
that of
the forecasted
security
and its conversion timeline to hedge its securitization
pipeline.
At
30,
2025,
the
held
trading
with
a
fair
value
of
$33.1
representing
0.04%
of
the
total
assets,
with
$32.8
million
and
0.05%,
at
31,
The
trading
principally of
investment grade
such
as mortgage-backed
of
$24.3
million with
a
weighted average
yield of 5.23% and U.S. Treasuries
of $8.0 million with a weighted average
yield of 2.57% at September 30, 2025
and $29.1 million
with a yield of 5.54% and $2.8 million with a
yield of 3.28%, respectively, as of December 31, 2024.
The Corporation’s trading activities are
limited by internal policies. For each
of the two subsidiaries, the
market risk assumed under
trading
activities
is
measured
by
the
5-day
net
value-at-risk
(“VAR”),
with
a
confidence
level
of
99%.
The
VAR
the
maximum estimated loss that may occur over a
5-day holding period, given a 99% probability.
The
trading
portfolio had
a
5-day
VAR
of
$0.4
million
for
the
last
week
of
September 2025.
VAR
models
include
assumptions and
thus actual
results could
differ from
the outputs
from these
models and
assumptions. Back-testing
is
performed
on
model
results
to
compare
actual
results
against
maximum
estimated
losses,
in
order
to
evaluate
model
and
assumptions accuracy.
In the opinion of management, the size and composition
of the trading portfolio does not represent
a significant source of market risk
for the Corporation.
Liquidity
Liquidity Risk Management Process
has adopted
policies and
limits to
monitor the
Corporation’s liquidity
position and
that of
its banking
subsidiaries.
Refer to
the Enterprise
Risk Management
section of
Management’s Discussion
and Analysis
the 2024
Form 10-K
for
information on the framework
in place to monitor,
review, and approve
policies to measure, limit and
manage funding activities and
strategies
impacting
risk.
contingency
funding
plans
are
used
to
model
various
stress
events
of
different
magnitudes that
affect different
time horizons,
to assist
management in
evaluating the
size of
the liquidity
buffers needed
if those
events occur. However,
such models may not predict
accurately how the market and customers
might react to every
event and are
dependent on
many assumptions.
The objective
of effective
liquidity management
is to
ensure that
has sufficient
to
meet
all
its
obligations,
finance
future
growth,
fund
planned
capital
and
maintain
a
reasonable safety margin for cash needs under both
normal and stressed market conditions.
Sources of Liquidity
Deposits, including
customer deposits,
brokered deposits
and public
funds deposits,
continue to
be the
most significant
source of
funds for the Corporation, representing
89% of funding of the
Corporation’s total assets at September 30,
2025 and December 31,
- The ratio
of total ending
loans to deposits
was 58% and
57% at September
30, 2025 and
December 31, 2024, respectively.
In addition to traditional deposits, the Corporation
maintains borrowing arrangements, which amounted to $1.2 billion
in outstanding
at
30,
(December
31,
$1.2
A
detailed
description
of
the
borrowings,
including their terms,
is included in
Note 13
to the
Consolidated Financial Statements.
Also, the
Consolidated Statements of
Cash
Flows in the accompanying Consolidated Financial
Statements provide information on the Corporation’s cash
inflows and outflows.
The
sections
provide
further
on
the
major
funding
activities
and
needs,
as
well
as
the
risks
involved in these activities.
Banking Subsidiaries
Primary
sources of
funding
for the
(BPPR and
PB
or,
collectively,
“the banking
subsidiaries”)
include
retail,
and
public
sector
brokered
loan
securitization and, to a lesser extent, loan sales. In
addition, the Corporation maintains borrowing facilities with the FHLB and at the
discount window
of the
Federal Reserve
Bank of
New York
(the “FRB”)
and has
a considerable
collateral pledged
that
can be used to raise funds under these facilities.
During the second quarter of 2025, BPPR was able to increase its available
liquidity by approximately $2.9 billion after the merger of
Popular Auto, LLC with
and into BPPR, effective
on May 1,
2025, that allowed BPPR
to pledge auto loans
and leases as collateral
under the federal reserve’s
discount window. At
Corporation’s available liquidity increased to
$25.8 billion
from $21.6
billion on
During the third
Corporation had no
material incremental use
of its
available liquidity sources. The liquidity sources of
the Corporation at September 30, 2025 are
presented in Table 12 below:
Table 12 - Liquidity Sources
BPPR
Total
BPPR
Total
Unpledged securities and unused funding
sources:
Money market (excess funds at the
Federal Reserve Bank)
$
3,719,430
$
1,024,811
$
4,744,241
$
4,882,358
$
1,488,857
$
6,371,215
Unpledged securities
4,658,303
1,010,386
5,668,689
3,806,066
522,869
4,328,935
FHLB borrowing capacity
3,134,633
1,023,693
4,158,326
2,777,090
1,058,921
3,836,011
Discount window of the Federal Reserve
Bank borrowing capacity
7,833,348
3,375,793
11,209,141
4,839,388
2,178,646
7,018,034
Total available liquidity
$
19,345,714
$
6,434,683
$
25,780,397
$
16,304,902
$
5,249,293
$
21,554,195
Refer
to
Note
to
the
for
of
the
borrowing
available through its banking subsidiaries.
The principal
uses of
funds for
the banking
subsidiaries include
loan originations,
investment portfolio
purchases, loan
and repurchases, repayment of outstanding obligations (including deposits), advances on certain serviced portfolios and operational
expenses. Also, the
banking subsidiaries assume liquidity
risk related to collateral
posting requirements for certain
activities mainly
in
connection
with
commitments,
provisions,
advances,
and
credit
card
licensing
The banking
subsidiaries maintain
sufficient funding
capacity to
address large
increases in
funding requirements
such as
deposit
outflows.
The
Corporation has
guidelines
that
require
the
banking
to
have
to
cover all short-term borrowings and a portion of deposits.
Deposits are
a key
source of
funding. Refer
to Table
7 for
a breakdown
of deposits
by major
types. Core
deposits are
generated
from a large base of consumer, corporate and public sector customers. Core deposits
include certificates
of deposit under $250,000,
all
interest-bearing
deposit
accounts,
non-interest-bearing
and
savings
deposits.
Core
exclude
brokered
and
certificates
of
deposit
over
$250,000.
Core
excluding
P.R.
public
funds,
which
are
fully
collateralized, have
historically provided
with a
sizable source
of relatively
stable and
low-cost funds.
P.R.
public
funds, while
linked to market
interest rates,
provide a stable
source of funding
with an
attractive earning spread.
As of
30, 2025, total Puerto Rico public sector deposits were
$20.1 billion, compared to $19.5 billion at December
Core deposits represent 92%
of total deposits at
$60.9 billion, as of
September 30, 2025, compared with
92% at $59.9 billion
as of
December 31, 2024. Core
deposits financed 85% of
the Corporation’s earning assets
at September 30, 2025,
compared to 86% at
The distribution by maturity
of certificates of deposit
with denominations of $250,000
and over at September
30, 2025 is
in the table that follows:
Table 13 - Distribution by
Maturity of Certificates of Deposit of $250,000 and Over
3 months or less
$
2,374,866
Over 3 to 12 months
1,102,624
Over 1 year to 3 years
278,729
Over 3 years
147,806
Total
$
3,904,025
The Corporation had
$1.8 billion in
brokered deposits at September
30, 2025, which
financed approximately
2% of its
total assets
(December 31, 2024 - $1.6 billion and 2%,
respectively).
As of
September 30, 2025,
the banking subsidiaries
had sufficient current
and projected liquidity
sources to meet
their anticipated
cash flow
obligations, as
well as
special needs
and off-balance
sheet commitments,
in the
and have
resources to
address
a
stress
event.
Although the
banking
have
historically
been
able
to
replace
maturing
deposits and
advances, no
assurance can
be given
that
they
would be
able to
replace those
funds
in the
future if
the
financial condition
or
general market
conditions
were to
deteriorate. The
Corporation’s financial
flexibility would
be
severely constrained if
the banking subsidiaries
are unable to
maintain access to
funding or if
adequate funding is
not available to
accommodate future
financing needs
at
acceptable interest
rates. The
also
are required
to
deposit cash
or
qualifying
to
meet
margin
on
agreements,
deposit
and
other
borrowing facilities. To
the extent that
the value of
securities previously pledged as
collateral declines because of
market changes,
the Corporation will be required to deposit additional cash or securities to meet its margin or collateral requirements and would need
to
rely
more
heavily
on
alternative
funding
sources.
In
these
scenarios,
the
flexibility
and
ability
to
grow
revenues may not increase proportionately to cover costs and
profitability would be adversely affected.
The Corporation considers balances in
excess of $250,000 to have a
higher potential liquidity risk.
Table
14 reflects the aggregate
balance in
deposit accounts
in excess
of $250,000,
including collateralized
public funds
and deposits
outside of
and its
territories.
Collateralized public funds, as presented in Table 14, represent public deposit balances from governmental
entities in the
U.S.
and
its
territories,
Puerto
Rico
and
the
United
States
Virgin
based
on
such
jurisdictions’
applicable collateral requirements.
Table 14 - Deposits
30-Sep-25
BPPR
(Consolidated)
Deposits balances under $250,000 [1]
$
23,610,775
%
$
8,523,789
%
$
32,134,564
%
Transactional deposits balances over
$250,000
8,203,843
%
2,096,865
%
10,300,708
%
Time deposits balances over $250,000
2,013,907
%
925,802
%
2,939,709
%
Uninsured foreign deposits
399,980
%
%
399,980
%
Collateralized public funds
20,422,015
%
316,428
%
20,738,443
%
Intercompany deposits
227,477
%
298,714
%
%
$
54,877,997
%
$
12,161,598
%
$
%
[1] Includes the first $250,000 in balances of transactional
and time deposit accounts with balances in excess
of $250,000.
31-Dec-24
BPPR
(Consolidated)
Deposits balances under $250,000 [1]
$
23,588,937
%
$
7,961,334
%
$
31,550,271
%
Transactional deposits balances over
$250,000
8,046,175
%
1,944,674
%
9,990,849
%
Time deposits balances over $250,000
1,991,934
%
813,424
%
2,805,358
%
Uninsured foreign deposits
450,068
%
%
450,068
%
Collateralized public funds
19,771,083
%
316,716
%
20,087,799
%
Intercompany deposits
205,839
%
667,839
%
%
$
54,054,036
%
$
11,703,987
%
$
%
[1] Includes the first $250,000 in balances of transactional
and time deposit accounts with balances in excess
of $250,000.
Bank Holding Companies
The principal
sources of
funding for
the BHCs,
which are
Inc.
(holding company
only) and
PNA, include
cash on
hand,
received from
banking
and
non-banking subsidiaries,
asset sales,
credit
available from
affiliate banking subsidiaries and proceeds from potential securities offerings.
Dividends from banking and non-banking subsidiaries
are subject
to various
regulatory limits
and authorization
requirements imposed
by banking
regulators, including
the FED
and the
NYDFS, that may limit the ability of those subsidiaries
to act as a source of funding to the BHCs.
The principal uses of these funds include the repayment of debt, interest payments to holders of senior debt and junior subordinated
deferrable interest debentures (related to trust preferred securities), the payment of dividends to common stockholders,
repurchases
of the Corporation’s securities and capitalizing its subsidiaries.
The
balance
of
notes
payable
at
the
BHCs
to
$595
million
at
30,
and
$594
million
at
The contractual maturities of the BHCs notes payable
at September 30, 2025 are presented in Table 15.
Table 15
- Distribution of BHC's Notes Payable by Contractual
Maturity
Year
$
396,249
Later years
198,393
Total
$
594,642
As of
BHCs had
cash and
money markets
investments totaling
$484 million
and borrowing
potential of
$165 million from its secured facility with BPPR.
The BHCs’ liquidity position continues to be adequate with sufficient
cash on hand,
other sources of
liquidity that are
expected to be
sufficient to
meet all
interest payments and
dividend obligations
for the
foreseeable future.
latest quarterly
paid dividend
was $0.70
or approximately
$47
million per quarter.
The BHCs have in
the past borrowed in the
corporate debt market primarily to finance
their non-banking subsidiaries and refinance
debt
These
sources
of
funding
are
more
costly
given
that
two
out
of
three
credit
rating
rate
the
Corporation’s debt
securities below
“investment grade”.
has a
shelf registration
statement filed
and effective
with
the
Securities
and
Exchange
Commission,
which
permits
the
to
issue
an
unspecified
amount
of
debt
or
equity
securities.
Non-Banking Subsidiaries
The
sources
of
funding
for
the
non-banking
include
internally
generated
cash
flows
from
operations,
loan
sales, repurchase agreements, capital
injections and borrowed funds
from their direct
parent companies or the
holding companies.
The principal uses of funds for the non-banking
subsidiaries include repayment of maturing debt,
operational expenses and payment
of dividends to the BHCs.
Dividends
During
the
third
quarter
of
2025,
the
a
common
stock
dividend
of
$0.75
per
common
share,
an
increase from $0.70 per common share in the previous quarter. During the nine months
ended September 30, 2025, the Corporation
cash
of
$2.15
per
common
share
($146.6
million
in
the
aggregate).
The
for
the
Corporation’s Series A preferred stock amounted to $1.1
During the nine months
ended September 30, 2025, the
BHCs received dividends and
distributions amounting to $350
BPPR, $23
from Popular
International Bank,
Inc. (“PIBI”)
and $22
its other
non-banking subsidiaries.
Dividends from
BPPR constitute Popular,
Inc.’s primary source
of liquidity.
In addition, during
the nine months
ended September 30, 2025,
PIBI, a
wholly
owned
subsidiary
of
Inc.,
received
$20.0
million
in
cash
and
$5.3
million
in
stock
from
its
investment in BHD.
In
regulatory
limits previously
discussed, the
ability
of a
bank
subsidiary to
up-stream dividends
to
its
BHC could
be
impacted by
its financial
performance and
capital, including
tangible and
regulatory capital,
thus potentially
limiting the
cash up
streamed to
the BHCs
banking subsidiaries.
This could,
in turn,
affect BHC’s
ability to
declare dividends
on its
common
and
preferred
stock,
repurchase its
or
meet
its
debt
obligations. At
30,
2025,
BPPR
could declare a dividend of up to approximately $237 million
without prior approval of the Federal Reserve Board due to
its retained
income, declared dividend activity and transfers to statutory reserves
over the measurement period. In addition, pursuant to the FRB
requirements, PB may not declare or pay a dividend
without the prior approval of the Federal Reserve
Board and the NYSDFS.
Other Funding Sources and Capital
In addition to cash reserves held at the FRB that totaled $4.7 billion at September 30, 2025, the debt securities portfolio provides an
source
of
liquidity,
which
may
be
realized
through
either
sales,
or
The
debt
of
liquid
U.S.
debt
and
U.S.
government sponsored agency
mortgage-backed securities that can
be used to
raise funds in
the repo markets.
The availability of
would
be
subject
to
having
collateral
at
the
time
the
are
consummated,
in
addition
to
overall
and
risk
appetite of
the
various
counterparties.
Refer
to
Table
for
details
of
the
debt
and
credit
with
the
FHLB
and
the
discount
window
of
the
Federal
Reserve Bank.
A substantial
portion of
these debt
securities could
be used
to raise
financing in
money markets
or from
secured lending sources,
subject to changes in their fair market value and
customary adjustments (haircuts).
Additional
may
be
provided
through
loan
maturities,
prepayments
and
sales.
The
loan
provides
a
source
of
collateral to
secure the
available credit
facilities with
the FHLB
and the
discount window
of the
Federal Reserve
Bank. The
loan
can
also
be
used
to
obtain
funding
in
the
capital
markets.
loans
and
some
types
of
loans,
have
secondary markets which the Corporation could use.
Off-Balance Sheet Arrangements and Other Commitments
In the ordinary course
of business, the Corporation
engages in financial transactions that
are not recorded on
the balance sheet or
may be recorded on the balance sheet in amounts that are different than the full contract or notional amount of the transaction. As a
provider of
financial services,
routinely enters
into commitments
with off-balance
sheet risk
to meet
needs
of
its
customers.
Refer
to
Note
to
the
for
on
the
commitments to extent credit and other non-credit commitments.
Other types
of off-balance
sheet arrangements
that the
Corporation enters
in the
include derivatives,
leases
and
of
guarantees,
indemnifications,
and
representation
and
warranties.
Refer
to
Note
to
the
a detailed
discussion related
to the
Corporation’s guarantees,
indemnifications obligations,
and representation and warranties arrangements.
The Corporation monitors its cash requirements, including
its contractual obligations and debt commitments.
Financial Information of Guarantor and Issuers of Registered
Guaranteed Securities
The principal sources of funding for Popular, Inc. Holding Company (“PIHC”) and Popular North America, Inc. (“PNA”) have included
dividends received
from their
banking and
non-banking subsidiaries subject
to statutory
provisions that
limit dividends
paid by
the
banking subsidiary without regulatory approval,
asset sales and proceeds from the issuance
of debt and equity.
The Corporation ("PIHC") is
the parent holding company
of Popular North America (“PNA”)
and operates financial services through
its subsidiaries. PNA, a wholly owned subsidiary of Popular, Inc., manages entities such as Equity One, Inc., and PB, including PB’s
subsidiaries: Popular Equipment Finance, LLC,
Popular Insurance Agency, U.S.A., and E-LOAN, Inc.
PNA has issued junior subordinated debentures guaranteed by PIHC (the “obligor group”), purchased by statutory
trusts established
by the Corporation using proceeds from trust preferred
securities (“capital securities”) and common securities
of the trusts.
PIHC guarantees
the junior
subordinated debentures
issued by
PNA. If
PIHC fails
to make
interest payments
on the
debentures
held by the trust,
the trust will not
distribute payments on the
capital securities. The guarantee
ranks subordinate and junior
in right
of
payment to
all
other liabilities
of
PIHC and
equally with
all
other PIHC-issued
guarantees, allowing
direct
legal
action against
PIHC without involving other entities.
Funding
for
PIHC
and
PNA
includes
from
subsidiaries,
asset
sales,
and
proceeds
from
debt
and
equity
issuance.
Statutory provisions limit the dividends an insured
depository institution can pay to its holding
company without regulatory approval.
The summarized financial information
below shows the combined
financial position of
the obligor group as
2025,
and December 31, 2024, and the
results of their operations for the
nine-month periods ended September 30, 2025, and September
30, 2024. Excluded are investments and equity
in earnings from subsidiaries and affiliates outside the
obligor group.
Intercompany balances
and transactions
within the
obligor group
have been
eliminated. Material
amounts due
from, due
to, and
transactions with subsidiaries and affiliates are shown separately. Related party transactions
are also presented separately.
Table 16 - Summarized Statement
of Condition
Assets
Cash and money market investments
$
484,141
$
634,809
37,618
35,150
Accounts receivables from non-obligor subsidiaries
14,541
14,602
Other loans (net of allowance for credit losses of $163 (2024
- $281))
24,486
25,381
Investment in equity method investees
5,265
5,279
95,829
65,483
$
661,880
$
780,704
Liabilities and Stockholders' equity
Accounts payable to non-obligor subsidiaries
$
5,839
$
12,163
594,642
593,571
131,489
126,718
Stockholders' (deficit) equity
(70,090)
48,252
Total liabilities and
stockholders' equity
$
661,880
$
780,704
Table 17 - Summarized Statement
of Operations
For the period ended
Income:
Dividends from non-obligor subsidiaries
$
371,500
$
473,000
Interest income from non-obligor subsidiaries and affiliates
3,125
8,489
(Losses) earnings from investments in equity method investees
(14)
Other operating income
8,027
3,116
Total income
$
382,638
$
484,634
Expenses:
Services provided by non-obligor subsidiaries and affiliates
(net of
reimbursement by subsidiaries for services provided by parent
of
$188,825 (2024 - $172,449))
$
13,390
$
9,654
Other expenses
19,492
30,000
[1]
7,075
21,934
Total expenses
$
39,957
$
61,588
$
342,681
$
423,046
[1] The net income
for the nine
30, 2024, included
$22.9 million of
expenses, of which
$16.5 million was
in income tax expense
and $6.4 million
was reflected in other
operating expenses, related
to an out-of-period adjustment
associated with the
Corporation’s U.S.
subsidiary’s non-payment
of taxes
on certain
intercompany distributions
to the
Bank Holding
Company (BHC)
in Puerto
Rico, a foreign corporation for U.S. tax purposes.
In
the
dividend income
in
the
Statement
of
Operations table
above, during
the
nine
months
ended
obligor group recorded a
$23.0 million of dividend
distributions from non-obligor subsidiary which
was recorded as a reduction to the investment
(2024 - $67.4 million).
Risk to Liquidity
The
may
come
under
pressure
if
it
experiences
unexpected
cash
outflows
due
to
deposit
withdrawals, which could arise
from various factors like
economic conditions, loss of
depositor confidence, competition, exogenous
events, regulatory requirements or changes, a
downgrade in credit rating, or other events
causing counterparties to avoid exposure.
Investors should refer to Liquidity Risks section of “Part I, Item 1A”
of 2024 Form 10-K for an additional discussion of liquidity
risks to
which the Corporation is subject.
Credit Risk
Geographic and Government Risk
The Corporation is exposed to geographic and government risk.
The Corporation’s assets and revenue composition by geographical
area and by
business segment reporting are
presented in Note
32 to the
Consolidated Financial Statements. Readers should
refer
to
Economic
and
Market
Risk
section
and
Business
Risk
Section
of
“Part
I,
Item
1A”
of
the
Form
10-K
for
an
on
how
the
Corporation is
by
global
and
local
and
market
conditions, including
weakness
in
the
economy,
particularly in Puerto
Rico, where a
significant portion of
our business is
concentrated. This section
also addresses how
our credit risk and credit
losses can increase to the extent
our loans are concentrated on borrowers engaged in
the same or similar
activities or in borrowers who as a group
may be uniquely or disproportionately affected by certain
economic or market conditions.
Commonwealth of Puerto Rico
A
significant portion
of
our financial
activities and
credit
exposure is
concentrated in
the
Commonwealth of
(“Puerto
Rico”) which has faced severe economic and fiscal
challenges in the past and may face additional
challenges in the future.
Economic Performance
The latest estimates from the
Puerto Rico Planning Board (the
“Planning Board”) indicate that real
GNP grew by 2.1%
during fiscal
year
(July 2023-June
- and
by
1.1% in
fiscal
year
2025 (July
2024-June 2025).
For fiscal
year 2026
(July
2025-June
2026),
the
Planning
Board
forecasts
more
modest
GNP
growth
of
0.5%.
Meanwhile,
the
Puerto
Rico
Economic
Activity
Index
showed a 0.9% year-over-year decline and a 0.2% month-over-month decline in June 2025. While this index is not a direct measure
of real GNP, it serves as an indicator of ongoing economic activity.
In
and
2022,
inflation
rose
sharply
in
the
U.S.
and
Puerto
Rico
due
to
post-pandemic
demand
and
supply
chain
issues.
Inflation
began
to
by
mid-2022
as
the
Federal
Reserve
raised
rates,
largely
stabilizing
by
2024,
leading
to
a
series
of
rate
reductions
by
the
Federal
Reserve
for
the
first
time
in
four
years.
As
of
2025,
the
U.S.
Consumer Price Index
showed a 3.0%
year-over-year increase, which
is significantly lower
than peak
2022 inflation levels
but still
above the Federal Reserve’s 2% target. In Puerto Rico,
the Consumer Price Index increased by 1.9%
over the same period.
Moreover, since October 1,
2025, a congressional impasse over fiscal year
2026 appropriations has triggered a partial shutdown
of
numerous U.S. federal agencies and
services. The shutdown has disrupted,
and may continue to
disrupt, federal payments to
U.S.
employees, beneficiaries
of
federal
programs
and transfers
to
Rico
government. While
these
disruptions
could adversely affect
our customers and
the broader Puerto
Rico economy,
the overall impact
remains uncertain and
will depend
largely on the shutdown’s duration and scope.
Fiscal Challenges of Puerto Rico and its Municipalities
As
Puerto Rico’s
economy contracted
in the
2000s, public
debt
increased rapidly
due to
borrowing to
cover
deficits to
pay
debt
service, pension benefits,
and other expenditures.
By 2016, the
government had over
$120 billion in
combined debt and
unfunded
pension liabilities, lost access to capital markets, and
faced a fiscal crisis.
In
response,
the
U.S.
Congress
enacted
PROMESA
in
June
PROMESA
an
Board
with
control over Puerto Rico’s
fiscal and economic affairs,
including those of its public
corporations, instrumentalities and municipalities
(collectively, “PR Government Entities”).
In August 2025, President Donald J. Trump dismissed six of the seven members of
the Oversight Board, reportedly due to inefficient
leadership and excessive spending. Three of the dismissed members subsequently filed suit in federal
court challenging the legality
of their dismissal. On October 3, 2025, the court issued a preliminary injunction that effectively reinstated such members and barred
the seating of replacement members
while the case proceeds. Such
ruling remains subject to potential
appeal. It is still
too early to
determine what impact these developments may
have on Puerto Rico’s fiscal and economic affairs.
Under PROMESA, the Oversight
Board will remain
in place until market
access is restored and
balanced budgets are achieved for
at
least
four
consecutive
years.
PROMESA
also
two
mechanisms
for
the
of
the
of
PR
Government Entities:
(a) Title
III, an
in-court process
akin to
that of
Bankruptcy Code
and which
permits adjustment
of a
broad range
of
obligations, and
(b) Title
VI,
a largely
out-of-court process
through which
a supermajority
of creditors
can
accept
modifications to debt and bind holdouts.
Since
2017,
Puerto
Rico
and
several
of
its
have
availed
themselves
of
these
mechanisms.
The
Puerto
Rico
government exited Title III in March 2022, and several instrumentalities, such as the Government Development Bank and the Puerto
Rico Highways and Transportation
Authority have also completed
debt restructurings under Titles
III or VI
of PROMESA. However,
the Puerto Rico Electric Power Authority is still undergoing
its debt restructuring.
Puerto
Rico's economic
difficulties
have also
impacted its
municipalities. Historically,
the central
government provided
municipal subsidies. However, these have decreased pursuant to fiscal measures required by the Oversight Board. This decline has
been partly
federal disaster
and COVID-relief
funding received
by municipalities
in recent
years. The
latest Puerto
Rico
fiscal plan proposes a
restructured grant system to enhance
municipal services and encourage accountability through
metrics.
Municipalities
are
subject
to
PROMESA,
and
the
Board
has
required
certain
municipalities
to
submit
fiscal
plans
and
annual budgets
for review
and approval.
Municipalities are
also required
to seek
Oversight Board
approval to
issue, guarantee
or
modify
their
debts
and
to
enter
into
contracts.
To
date
no
has
availed
itself
of
the
debt
mechanisms available to them under PROMESA.
Exposure of the Corporation
The credit quality of BPPR’s
loan portfolio is closely tied to the
economic conditions in Puerto Rico. Deterioration in the Puerto
Rico
economy
could
potentially
delinquencies
and
charge-offs,
thereby
impacting
the
health.
The
Corporation has direct exposure to P.R. Government Entities, which are mainly concentrated in obligations from various Puerto Rico
municipalities. Additionally,
holds loans
and securities
insured by
P.R.
Government Entities,
such as
the Housing
Finance
Authority,
whose
ability
to
honor
guarantees
depends
on
its
condition.
and
consumer loan portfolios are also exposed to risks from private borrowers who are service providers or have other relationships with
Rico government
and government employees
who could
be negatively
affected by
Puerto Rico’s
fiscal challenges.
For
further
of
the
direct
and
indirect
to
the
Puerto
Rico
government and
its
instrumentalities and
municipalities, please refer to Note 18 – Commitments
and Contingencies to the Consolidated
The
also
maintains
from
P.R.
Entities,
with
future
subject
to
various
uncertainties.
Further
on
Puerto
Rico
is
in
Note
–
to
the
United States Virgin Islands
The Corporation has operations in the United
States Virgin Islands (“USVI”) and has credit exposure
to USVI government entities.
Non-Performing Assets
During
the
third
quarter
of
2025,
the
credit
quality
metrics
were
affected
by
two
unrelated
exposures,
resulting in
a
$188.4
million
NPLs.
The
determination
of
classifying
these
loans
as
NPLs
was
driven
by
factors specific to the individual borrowers and
are not believed to be indicative of a broader
decline in portfolio credit quality.
The first
loan classified
as NPL
is a
$158.3 million
commercial and
industrial facility
issued to
a telecommunications
company in
experiencing reduced
revenue due
to operational
challenges following
a business
acquisition and
client attrition.
The
second
loan
as
NPL
is
a
$30.1
million
real
estate
facility,
a
$13.5
million
charge-off
during
the
quarter, and is secured by a hotel property in Florida.
Excluding these cases, credit quality metrics were stable. The Corporation
continues to closely monitor the economic landscape and
borrower performance,
as economic
uncertainty remains
a key
consideration. The
Corporation’s experience
managing credit
risk
under different
macroeconomic and operating
environments and, more
recently,
the steps
taken around
credit tightening
supports
management’s view
that exposure to
riskier borrowers is
adequately managed. Nonetheless, carefully
monitoring the
of our loan portfolio and its response to the
environment will continue to be a priority.
Total NPAs
of $545.2 million as of September 30, 2025, increased by $137.1
million when compared with December 31, 2024. Total
NPLs of
$502.2 million increased
by $151.4
million from December
BPPR’s NPLs
increased by $161.3
million, primarily
due to the classification of the two commercial exposures with book values of $158.3 million and $30.1 million as NPLs, partly offset
by lower mortgage NPLs by $18.5 million.
Popular U.S. NPLs decreased by $9.9 million, mostly
driven by decreases of $6.9 million
and $2.1 million in commercial and mortgage NPLs,
respectively.
On September
the ratio
of NPLs
to total
loans held-in-portfolio was
1.30%, compared to
0.95% on
Other real estate owned loans (“OREOs”) totaled $43.0
million, a decrease of $14.3 million from December
31, 2024. On September
30,
2025,
NPLs secured
by
$211
Rico
operations and
$47
million
in Popular
U.S,
compared with $200 million and $56 million, respectively, on December
The Corporation’s commercial loan
portfolio secured by real
estate (“CRE”) amounted to $11.0
billion on September 30, 2025,
with
$3.1 billion secured by owner-occupied properties
(December 31, 2024 - $10.9 billion and $3.2
billion, respectively).
CRE NPLs amounted to
$78.4 million on September
30, 2025, compared with $53.7
million on December 31,
- The CRE NPL
ratios
for
the
BPPR
and
Popular
U.S.
were
1.31%
and
0.25%,
on
30,
2025,
with
0.64% and 0.37%, respectively, on December 31, 2024.
The non-owner occupied CRE portfolio was $5.5 billion at September
30, 2025, split between $3.3 billion in BPPR and $2.2 billion in
Popular U.S. This portfolio is diversified across sectors: retail (33%), hotels (19%),
and office space (13%) which together represent
two-thirds of
total non-owner
occupied CRE
exposure. Specifically,
office space
leasing accounts
for just
1.8% ($713.4
million) of
the total
loan portfolio,
mainly comprising
mid-rise
properties with
loan size
of $2.5
million, and
is well
diversified by
tenant type.
Within CRE, the
commercial multi-family portfolio is
$2.5 billion (approximately 6%
of total loans),
concentrated in New
York
Metro
($1.5 billion), South Florida ($672.2 million) and Puerto Rico ($199.6
million) regions. In the New York Metro, there is no exposure to
rent-controlled buildings and rent-stabilized
units make up less than 40% of total units,
with most originated after 2019.
In
addition
to
the
NPLs
in
Table
18,
on
30,
2025,
there
were
$724
million
of
performing
loans,
mostly
loans,
which
in
opinion,
are
subject
to
potential
future
classification
as
(December 31, 2024 - $596 million).
The following table presents the Corporation’s NPAs as of September 30, 2025 and December
31, 2024:
Table 18 - Non-Performing
Assets
BPPR
Popular
U.S.
Inc.
As a % of
loans HIP
by
category
BPPR
Popular
U.S.
Inc.
As a % of
loans HIP
by
category
$
$
8,467
$
8,641
0.3
%
$
$
8,700
$
8,779
0.4
%
Commercial real estate non-owner
37,043
7,083
44,126
0.8
6,429
8,015
14,444
0.3
Commercial real estate owner
25,619
25,619
0.8
25,258
5,191
30,449
1.0
173,245
1,246
174,491
2.1
19,335
1,748
21,083
0.3
236,081
16,796
252,877
1.3
51,101
23,654
74,755
0.4
139,958
27,809
167,767
2.0
158,442
29,890
188,332
2.3
Leasing
7,747
7,747
0.4
9,588
9,588
0.5
3,257
3,257
4.1
3,393
3,393
4.6
18,375
19,316
1.0
20,269
1,741
22,010
1.2
Auto
49,432
49,432
1.3
51,792
51,792
1.4
Other
1,776
1,806
1.0
0.5
69,583
4,228
73,811
1.0
72,960
5,145
78,105
1.1
Total non-performing
loans held-in-
453,369
48,833
502,202
1.3
%
292,091
58,689
350,780
0.9
%
Other real estate owned (“OREO”)
42,446
42,950
57,197
57,268
Total non-performing
assets
[1]
$
495,815
$
49,337
$
545,152
$
349,288
$
58,760
$
408,048
Accruing loans past due 90 days or
more
[2]
$
205,168
$
$
205,356
$
242,250
$
$
242,440
Ratios:
Non-performing assets to total assets
0.84
%
0.30
%
0.73
%
0.61
%
0.37
%
0.56
%
Non-performing loans held-in-portfolio
to loans held-in-portfolio
1.67
0.42
1.30
1.12
0.54
0.95
Allowance for credit losses to loans
2.56
0.79
2.03
2.56
0.69
2.01
Allowance for credit losses to non-
performing loans, excluding held-for-
sale
153.38
186.07
156.55
229.61
128.40
212.68
[1] There were no non-performing loans held-for-sale
as of September 30, 2025 and December 31, 2024.
[2] It is the Corporation’s policy to report delinquent
residential mortgage loans insured by FHA or guaranteed
by the VA as accruing
loans past due 90
days or
more
as
opposed
to
since
the principal
repayment
is insured.
These
include
$49 million
of residential
loans insured
by FHA
or guaranteed
by the
VA
no longer
accruing interest
as of
2025 (December
- $65
Furthermore, the Corporation
has $29 million
in reverse mortgage
loans which are
guaranteed by FHA,
but which are
currently not accruing
interest.
Due to the guaranteed
nature of the loans,
it is the Corporation’s
policy to exclude these
balances from non-performing
assets (December 31,
2024 -
$31 million).
For the quarter
2025, total inflows
of NPLs held-in-portfolio,
excluding consumer loans, increased
by $187.0
million, when compared to the inflows for the same period in 2024. Inflows of NPLs held-in-portfolio at the BPPR segment increased
by $205.2
million, compared
to the
same period
in 2024,
by the
two commercial
exposures that
were classified
as
NPLs during
the quarter.
Inflows of
NPLs held-in-portfolio
at the
segment decreased
by $18.2
period in 2024, driven by lower mortgage NPL
inflows by $17.4 million.
Tables 19 to 25 present the Corporation’s inflows to NPLs for the quarters and nine months
ended September 30, 2025 and 2024.
Table 19 - Activity in Non
-Performing Loans Held-in-Portfolio (Excluding Consumer
Loans)
BPPR
BPPR
$
189,630
$
49,763
$
239,393
$
209,543
$
53,544
$
263,087
Plus:
241,745
4,786
246,531
310,973
21,853
332,826
Less:
(2,333)
(2,333)
(7,273)
(433)
(7,706)
(13,854)
(13,854)
(15,571)
(1,713)
(17,284)
(39,149)
(9,992)
(49,141)
(121,633)
(28,732)
(150,365)
$
376,039
$
44,605
$
420,644
$
376,039
$
44,605
$
420,644
Table 20 - Activity in Non
-Performing Loans Held-in-Portfolio (Excluding Consumer
Loans)
BPPR
BPPR
$
219,960
$
49,317
$
269,277
$
254,476
$
22,354
$
276,830
Plus:
36,585
22,968
59,553
111,128
84,248
195,376
Less:
(4,016)
(4,016)
(12,665)
(24)
(12,689)
(4,031)
(82)
(4,113)
(17,930)
(1,050)
(18,980)
(36,759)
(5,325)
(42,084)
(123,270)
(38,970)
(162,240)
$
211,739
$
66,910
$
278,649
$
211,739
$
66,910
$
278,649
Table 21 - Activity in Non
-Performing Commercial Loans Held-in-Portfolio
BPPR
BPPR
$
42,166
$
21,711
$
63,877
$
51,101
$
23,654
$
74,755
Plus:
211,193
1,775
212,968
218,742
12,820
231,562
Less:
(260)
(260)
(13,779)
(13,779)
(14,921)
(1,713)
(16,634)
Loans returned to accrual status / loan
collections
(3,499)
(6,738)
(10,237)
(18,581)
(18,050)
(36,631)
$
236,081
$
16,796
$
252,877
$
236,081
$
16,796
$
252,877
Table 22 - Activity in Non
-Performing Commercial Loans Held-in-Portfolio
BPPR
BPPR
$
56,170
$
37,763
$
93,933
$
72,992
$
11,163
$
84,155
Plus:
4,460
2,582
7,042
12,834
39,561
52,395
Less:
(280)
(280)
(4,085)
(82)
(4,167)
(17,784)
(1,032)
(18,816)
(2,726)
(1,790)
(4,516)
(13,943)
(11,521)
(25,464)
$
53,819
$
38,476
$
92,295
$
53,819
$
38,476
$
92,295
Table 23 - Activity in Non
-Performing Construction Loans Held-in-Portfolio
BPPR
BPPR
$
$
$
$
6,378
$
$
6,378
Less:
(6,378)
(6,378)
$
$
$
$
$
$
Table 24 - Activity in Non
-Performing Mortgage Loans Held-in-Portfolio
For the nine months ended
BPPR
BPPR
$
147,464
$
28,052
$
175,516
$
158,442
$
29,890
$
188,332
Plus:
30,552
3,011
33,563
92,231
9,033
101,264
Less:
(2,333)
(2,333)
(7,013)
(433)
(7,446)
(75)
(75)
(650)
(650)
(35,650)
(3,254)
(38,904)
(103,052)
(10,682)
(113,734)
$
139,958
$
27,809
$
167,767
$
139,958
$
27,809
$
167,767
Table 25 - Activity in Non
-Performing Mortgage Loans Held-in-Portfolio
BPPR
BPPR
$
163,790
$
11,554
$
175,344
$
175,106
$
11,191
$
186,297
Plus:
32,125
20,386
52,511
98,294
44,687
142,981
Less:
(4,016)
(4,016)
(12,385)
(24)
(12,409)
(146)
(18)
(164)
(34,033)
(3,535)
(37,568)
(102,949)
(27,449)
(130,398)
$
157,920
$
28,434
$
186,354
$
157,920
$
28,434
$
186,354
Loan Delinquencies
Another key measure used to evaluate and
monitor the Corporation’s asset quality is loan
delinquencies. Loans delinquent 30 days
or more, as a percentage of their related portfolio
category on September 30, 2025 and December 31,
2024, are presented below.
Table 26 - Loan Delinquencies
Loans delinquent
30 days or more
Total delinquencies
as a percentage
of total loans
Loans delinquent
30 days or more
Total delinquencies
as a percentage
of total loans
$
12,637
$
0.51
%
$
15,826
$
0.66
%
Commercial real estate
non-owner occupied
61,924
1.13
24,925
0.46
Commercial real estate
43,163
1.40
42,311
1.34
200,876
2.44
49,942
0.65
318,600
1.65
133,004
0.71
4,589
0.29
1,039
0.08
[1]
718,940
8.40
798,130
9.84
Leasing
36,656
1.83
39,641
2.06
49,098
4.01
59,078
4.85
3,987
78,890
5.05
5,054
73,571
6.87
52,491
2.76
57,835
3.12
Auto
179,213
4.65
191,008
5.00
Other
5,377
181,220
2.97
3,930
171,778
2.29
290,166
4.01
316,905
4.44
7,783
5,423
Total
$
1,368,951
$
3.54
%
$
1,288,719
$
3.47
%
[1]
Loans delinquent 30 days or more includes $0.4 billion
of residential mortgage loans insured by FHA or guaranteed
by the VA as of September
30, 2025 (December 31, 2024 - $0.4 billion). Refer to Note
7 to the Consolidated Financial Statements for additional information
of guaranteed loans.
Allowance for Credit Losses Loans Held-in-Portfolio
The ACL
represents management’s
estimate of
expected credit
losses through
the remaining
contractual life
of the
different loan
segments, impacted by expected prepayments. The ACL
is maintained at a sufficient
level to provide for estimated credit
losses on
collateral dependent loans as well as loans modified
for borrowers with financial difficulties separately from the remainder
of the loan
portfolio. Refer to
Note 8 to
the Consolidated Financial
Statements, for additional
information on the
Corporation’s methodology to
estimate its ACL.
the ACL increased
by $40.2
2024 to
$786.2 million. The
ACL was
mainly
driven
by
a
combination
of
changes
in
the
weights,
in
qualitative
in
response to
the current
economic environment uncertainty,
higher loan volumes,
and a
specific reserve
recognized for the
$158.3
million commercial NPL inflow described above. These increases
were offset in part by the net effect of changes in
credit quality and
NCOs during
the period.
Given that
any economic
outlook is
inherently uncertain, the
Corporation leverages multiple
scenarios to
estimate its ACL. Prior to the first quarter of 2025, the Corporation assigned the baseline scenario the highest probability among the
scenarios
used
to
the
ACL,
followed
by
the
given
the
uncertainties
in
the
outlook
and
downside risk, and
the optimistic scenario
had the lowest
probability. During
of 2025, the
Corporation modified the
weight assigned
to the
pessimistic scenario to
be equal
to the
baseline scenario
in response
to the
current economic
uncertainty,
resulting in
of $18.2
the reserves.
In
probability weight
for the
scenario was moderately decreased based on changes in the economic outlook and a reassessment of uncertainty compared to the
quarter.
This
change
resulted
in
a
$4.5
million
in
ACL
reserve
levels,
for
a
$13.7
million
net
from
31,
The
weight
for
the
remains
above
the
levels
observed
in
2024,
given
the
ongoing economic uncertainty.
At September 30, 2025, the ACL for BPPR increased by $24.7 million from December 31, 2024, driven by changes in the probability
weights that
resulted in
a
$8.8 million
net ACL
increase, higher
loan volumes,
and
a specific
reserve recognized
for
the
$158.3
million commercial NPL
inflow described above.
These increases were partially
improvements in credit
quality and NCOs
period. In
PB, the
ACL increased
by $15.5
million, when
- This
increase was
mainly
driven by higher qualitative reserves for the CRE portfolio in response to current market volatility and economic uncertainty, coupled
with changes in the probability weights that resulted in
a $4.9 million net increase.
The Corporation’s ratio of the allowance for
credit losses to loans held-in-portfolio was 2.03%
on September 30, 2025, compared to
2.01% on December
31, 2024. The
ratio of the
ACL to NPLs
held-in-portfolio stood at 156.6%,
compared to 212.7%
on December
Tables
27 and
28 detail
the allowance
loan categories
and the
percentage it
represents of
total loans
held-in-
portfolio and
NPLs. The
breakdown is
made for
analytical purposes,
and it
is not
necessarily indicative
of the
categories in
which
future loan losses may occur.
Table 27 - Allowance for Credit
Losses - Loan Portfolios
Total ACL
Total loans held-
ACL to loans held-
Total non-
ACL to non-
$
16,582
$
0.67
%
$
8,641
191.90
%
58,845
1.08
%
44,126
133.36
%
49,191
1.59
%
25,619
192.01
%
169,307
2.05
%
174,491
97.03
%
$
293,925
$
1.52
%
$
252,877
116.23
%
11,104
0.69
%
86,981
1.02
%
167,767
51.85
%
Leasing
19,220
0.96
%
7,747
248.10
%
87,208
7.12
%
1,548
78,890
1.96
%
3,257
47.53
%
100,238
5.27
%
19,316
518.94
%
Auto
177,819
4.62
%
49,432
359.72
%
Other
8,177
181,220
4.51
%
1,806
452.77
%
$
374,990
$
5.18
%
$
73,811
508.04
%
Total
$
786,220
$
2.03
%
$
502,202
156.55
%
Table 28 - Allowance for Credit
Losses - Loan Portfolios
Total ACL
Total loans held-
ACL to loans held-
Total non-
ACL to non-
$
9,236
$
0.38
%
$
8,779
105.21
%
54,494
1.02
%
14,444
377.28
%
49,828
1.58
%
30,449
163.64
%
146,006
1.89
%
21,083
692.53
%
$
259,564
$
1.39
%
$
74,755
347.22
%
11,264
0.89
%
82,409
1.02
%
188,332
43.76
%
Leasing
16,419
0.85
%
9,588
171.25
%
99,130
8.14
%
1,503
73,571
2.04
%
3,393
44.30
%
102,736
5.54
%
22,010
466.77
%
Auto
165,995
4.34
%
51,792
320.50
%
Other
7,004
171,778
4.08
%
769.67
%
$
376,368
$
5.27
%
$
78,105
481.87
%
Total
$
746,024
$
2.01
%
$
350,780
212.68
%
Annualized net charge-offs (recoveries)
annualized net charge-offs
(recoveries) to average
loans held-in-portfolio (“HIP”)
by loan
category for
the quarters and nine months ended September
30, 2025 and 2024.
Table 29 - Annualized Net Charge
-offs (Recoveries) to Average Loans
Held-in-Portfolio
BPPR
BPPR
0.50
%
0.03
%
0.29
%
0.13
%
0.02
%
0.08
%
―
―
―
(2.33)
―
(0.37)
(0.12)
(0.01)
(0.11)
(0.24)
(0.01)
(0.20)
Leasing
0.41
―
0.41
0.49
―
0.49
2.48
1.69
2.46
3.14
7.17
3.26
Total annualized
net charge-offs
(recoveries) to average loans held-in-
0.84
%
0.04
%
0.60
%
0.86
%
0.15
%
0.65
%
BPPR
BPPR
0.14
%
0.02
%
0.08
%
0.21
%
0.03
%
0.13
%
―
―
―
(0.82)
(0.01)
(0.14)
(0.14)
(0.03)
(0.12)
(0.25)
(0.01)
(0.21)
Leasing
0.55
―
0.55
0.64
―
0.64
2.53
3.23
2.54
2.93
7.43
3.07
Total annualized
net charge-offs
(recoveries) to average loans held-in-
0.73
%
0.06
%
0.53
%
0.86
%
0.18
%
0.66
%
NCOs for
$57.8 million,
decreasing by
$0.7 million
to
the
same period in 2024. The BPPR
segment increased by $2.0 million, mainly driven
by an increase of $9.9 million
and $1.7 million in
commercial and mortgage NCOs, respectively,
mostly due to a $13.5 million charge-off related to the $30.1 million commercial
NPL
inflow, partially
offset by a decrease
of $10.5 million in consumer
NCOs. The PB segment NCOs
decreased by $2.7 million, mainly
driven by lower consumer NCOs by $3.0 million
NCOs for the nine
months ended September 30, 2025,
amounted to $149.1 million, decreasing by
$25.3 million when compared to
the same period in 2024. The BPPR segment decreased by $16.6 million, mainly driven
by a decrease of $17.5 million in consumer
NCOs. The PB segment NCOs decreased by $8.6
million, mainly driven by lower consumer NCOs by
$7.9 million.
Loan Modifications
For the quarter ended September 30, 2025, modified loans to borrowers with financial difficulty amounted to $156.0 million, of which
$146.8 million were in
accruing status. The BPPR segment’s modifications
to borrowers with financial difficulty
amounted to $154.5
million, mainly comprised of commercial and mortgage loans of $130.1
million and $17.7 million, respectively. A total of $12.9 million
of
the
were
related
to
loans.
The
Popular
U.S.
segment’s
to
borrowers with financial difficulty amounted to $1.4 million,
mostly comprised of commercial loans.
Refer
to
Note
to
the
for
on
made
to
experiencing financial difficulties.
ADOPTION OF NEW ACCOUNTING STANDARDS AND ISSUED BUT NOT
YET EFFECTIVE ACCOUNTING STANDARDS
Refer to Note 3, “New Accounting Pronouncements”
Market Risk
Quantitative and qualitative disclosures for the current
period can be found in the Market Risk
section of this report, which includes
changes in market risk exposures from disclosures presented
in the 2024 Form 10-K.
Disclosure Controls and Procedures
The Corporation’s management,
participation of the
Corporation’s Chief Executive
Officer and Chief
Financial Officer,
has
evaluated the effectiveness of the Corporation’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and
15d-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”) as of the end of the period covered by this report. Based
on such evaluation, the Corporation’s Chief Executive Officer and Chief Financial Officer have concluded that,
as of the end of such
period, the Corporation’s disclosure controls and procedures are effective in recording, processing, summarizing and reporting, on a
timely basis,
information required to
be disclosed
by the
Corporation in
the reports
that it
files or
submits under
the Exchange Act
and
such
is
accumulated
and
communicated
to
management,
as
appropriate,
to
allow
timely
decisions
required disclosures.
Internal Control Over Financial Reporting
There have been no changes in the Corporation’s internal control over financial reporting (as such term is defined in Rules 13a-15(f)
and 15d-15(f) under the Exchange Act) that occurred during the quarter ended September 30, 2025 that have materially affected, or
are reasonably likely to materially affect, the Corporation’s internal
control over financial reporting.
Part II - Other Information
For a discussion of Legal Proceedings, see Note 18
In addition to the other information set forth in
this report, you should carefully consider the risk
factors discussed under “Part I - Item
1A - Risk Factors” in our 2024 Form
10-K. These factors could materially adversely affect our business, financial condition, liquidity,
results of
operations and
capital position,
and could
cause our
actual results
to
differ
materially from
our historical
results or
the
results contemplated
by the
forward-looking statements
contained in
this report.
Also refer
to the
discussion in
“Part I
- Item
2 –
Management’s Discussion
and Analysis
of Financial
Condition and
Results of
Operations” in
this report
for additional
that may supplement or update the discussion
of risk factors below and in our 2024 Form 10-K.
There have been no material changes to the risk
factors previously disclosed under Item 1A of the
Corporation’s 2024 Form 10-K.
The risks described
in our 2024 Form
10-K and in
this report are not
the only risks
facing us. Additional risks
and uncertainties not
known
to
us
or
that
we
deem
to
be
immaterial
also
may
materially
adversely
affect
our
business,
condition, liquidity, results of operations and capital position.
Unregistered Sales of Equity Securities and
Use of Proceeds
The Corporation did not have any unregistered
sales of equity securities during the quarter ended September
30, 2025.
Issuer Purchases of Equity Securities
The following table
sets forth the
details of
purchases of common
stock by
the Corporation and
its affiliated
purchasers during the
quarter ended September 30, 2025:
Issuer Purchases of Equity Securities
Not in thousands
Period
Total Number of
Shares Purchased [1]
Average Price Paid per
Share
Total Number of
Shares
Purchased as Part of Publicly
Announced Plans or Programs [2]
Approximate Dollar Value of
Shares that May Yet be
Purchased Under the Plans or
Programs [2]
July 1 - July 31
247,066
$
114.06
247,066
$520,194,763
August 1 -August 31
418,011
117.25
417,467
$471,246,181
September 1 - September 30
336,706
125.82
336,329
$428,924,967
Total
1,001,783
$
119.35
$428,924,967
[1] Includes 544
and 377 shares
of the Corporation’s
acquired by the
Corporation during
August and
September 2025,
in
connection
satisfaction
of tax
withholding
on vested
awards of
stock
or restricted
stock
units
granted to
directors
and
certain employees under the Corporation’s Omnibus Incentive
Plan. The acquired shares of common stock were added
back to treasury stock.
[2]
As part of its
capital plan, in July
2025, the Corporation announced
plans to repurchase up
to $500 million in common
stock, in addition to
the $500
repurchase program
announced in
July 2024.
As of
Corporation repurchased
5,664,241 shares
of
common stock for $571 million at an average price
of $100.80 per share, as part of the 2024 and 2025
common stock repurchase programs.
Defaults Upon Senior Securities
None.
Mine Safety Disclosures
Not applicable.
Rule 10b5-1 Trading Plans or Other Preplanned Trading Arrangements
Certain of our
officers or directors have
made, and may from
time to time make,
elections to participate in,
and are
participating in
,
our dividend reinvestment and purchase plan, the
Company stock fund associated with our 401(k)
plans and/or the Company stock
fund associated with
our non-qualified deferred compensation
plans and have shares
withheld to cover
withholding taxes upon the
vesting of
equity awards, which
may be
designed to satisfy
the affirmative defense
conditions of Rule
10b5-1 under the
Exchange
Act or may constitute non-Rule 10b5–1
trading arrangements
(as defined in Item 408(c) of Regulation
S-K).
Exhibits
Exhibit Index
Exhibit No
Exhibit Description
22.1
Issuers of Guaranteed Securities (Incorporated by reference to Exhibit 22.1 of Popular, Inc.’s Annual
Report on Form 10-K for the year ended December 31, 2024)
31.1
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(1)
31.2
Certification pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
(1)
32.1
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002
(1)
32.2
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002
(1)
- INS
XBRL Instance Document – the instance document
does not appear in the Interactive Data File because
its XBRL tags are embedded within the Inline Document.
101.SCH
Inline Taxonomy Extension Schema Document
(1)
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase Document
(1)
101.DEF
Inline XBRL Taxonomy Extension Definitions Linkbase Document
(1)
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase Document
(1)
101.PRE
Inline XBRL Taxonomy Extension Presentation Linkbase Document
(1)
The cover page of Popular, Inc. Quarterly Report on Form 10-Q for the
2025, formatted in Inline XBRL (included within the Exhibit
101 attachments)
(1)
(1)
Included herewith
- This exhibit is a management contract or compensatory
plan or arrangement.
Popular, Inc. has not filed as exhibits certain instruments defining
the rights of holders of debt of Popular, Inc. not
exceeding 10% of the total assets of Popular, Inc. and its consolidated
subsidiaries. Popular, Inc. hereby agrees to
furnish upon request to the Commission a copy of
each instrument defining the rights of holders
of senior and
subordinated debt of Popular, Inc., or of any of its consolidated
subsidiaries.
SIGNATURES
Pursuant to the
requirements of the Securities Exchange
Act of 1934, the
registrant has duly caused this
report to be signed
on its
behalf by the undersigned thereunto duly authorized.
(Registrant)
Date: November 10, 2025
By: /s/ Jorge J. García
Jorge J. García
Executive Vice President &
Chief Financial Officer
Date: November 10, 2025
By: /s/ Denissa M. Rodríguez
Denissa M. Rodríguez
Senior Vice President & Corporate Comptroller
The text of this filing, as the company filed it with the SEC, without its images or exhibits. This is not investment advice.