Popular, Inc. Files 10-Q for Period Ending March 31, 2024

TL;DR

<b>Popular, Inc. has submitted its Q1 2024 10-Q filing, detailing its financial position and investment holdings.</b>

AI Summary

POPULAR, INC. (BPOPM) filed a Quarterly Report (10-Q) with the SEC on May 10, 2024. Popular, Inc. filed a 10-Q report for the period ending March 31, 2024. The filing includes data related to various financial instruments and investments. Specific mentions include USTreasurySecurities, PuertoRicoStatesAndPoliticalSubdivisionsDebtSecurities, and MortgageBackedSecurities. The company also reported on MortgageLoanCommitments and various debt securities. The report details fair value disclosures for different asset categories.

Why It Matters

For investors and stakeholders tracking POPULAR, INC., this filing contains several important signals. This 10-Q provides investors with a detailed look at Popular, Inc.'s financial health and investment strategies as of Q1 2024. The specific financial instruments and debt securities mentioned offer insight into the company's risk exposure and asset allocation.

Risk Assessment

Risk Level: medium — POPULAR, INC. shows moderate risk based on this filing. The filing contains extensive details on various debt securities and financial instruments, indicating a complex financial structure that warrants careful review for potential risks.

Analyst Insight

Investors should review the detailed breakdown of debt securities and mortgage-backed assets to assess the company's exposure to interest rate and credit risks.

Key Numbers

• 2024-03-31 — Reporting Period End Date (CONFORMED PERIOD OF REPORT)
• 2024-05-10 — Filing Date (FILED AS OF DATE)
• 192 — Public Document Count (PUBLIC DOCUMENT COUNT)
• 001-34084 — SEC File Number (SEC FILE NUMBER)

Key Players & Entities

• POPULAR, INC. (company) — FILER
• 2024-03-31 (date) — CONFORMED PERIOD OF REPORT
• 2024-05-10 (date) — FILED AS OF DATE
• 763901 (company) — CENTRAL INDEX KEY
• 6022 (industry) — STANDARD INDUSTRIAL CLASSIFICATION
• 7877659800 (phone) — BUSINESS PHONE
• BANPONCE CORP (company) — FORMER COMPANY
• BPOPM (ticker) — ticker symbol

FAQ

Risk Factors

• Fair Value Disclosures [medium — financial]: The filing details fair value disclosures for various financial instruments, including Level 1 and Level 2 inputs, indicating the valuation methods used.
• Debt Securities [medium — financial]: Extensive reporting on various types of debt securities, including USTreasurySecurities, MortgageBackedSecurities, and other debt securities, highlights potential interest rate and credit risks.
• Mortgage Loans [medium — financial]: Information on ResidentialMortgage and MortgageLoanCommitments suggests exposure to the real estate market and associated risks.

Key Dates

• 2024-03-31: Quarter End Date — End of the reporting period for the 10-Q.
• 2024-05-10: Filing Date — Date the 10-Q was officially filed with the SEC.

Glossary

10-Q

A quarterly report required by the U.S. Securities and Exchange Commission (SEC). (Provides investors with a comprehensive update on the company's financial performance and position during the quarter.)

Key Financial Figures

• $0.01 — nge on which registered Common Stock ($0.01 par value) BPOP The NASDAQ Stock Mar

Filing Documents

• d799277d10q.htm (10-Q) — 9574KB
• d799277dex101.htm (EX-10.1) — 129KB
• d799277dex311.htm (EX-31.1) — 21KB
• d799277dex312.htm (EX-31.2) — 20KB
• d799277dex321.htm (EX-32.1) — 7KB
• d799277dex322.htm (EX-32.2) — 7KB
• g799277d799277dex101p1i0.jpg (GRAPHIC) — 6KB
• g799277d799277dex311p1i0.jpg (GRAPHIC) — 2KB
• g799277d799277dex312p1i0.jpg (GRAPHIC) — 2KB
• g799277d799277dex321p1i0.jpg (GRAPHIC) — 2KB
• g799277d799277dex322p1i0.jpg (GRAPHIC) — 2KB
• 0001193125-24-136053.txt (&nbsp;) — 45830KB
• bpop-20240331.xsd (EX-101.SCH) — 362KB
• bpop-20240331_cal.xml (EX-101.CAL) — 262KB
• bpop-20240331_def.xml (EX-101.DEF) — 1996KB
• bpop-20240331_lab.xml (EX-101.LAB) — 3467KB
• bpop-20240331_pre.xml (EX-101.PRE) — 2589KB
• d799277d10q_htm.xml (XML) — 11368KB

– Financial Information

Part I – Financial Information Page

Financial Statements

Item 1. Financial Statements Unaudited Consolidated Statements of Financial Condition at March 31, 2024 and December 31, 2023 6 Unaudited Consolidated Statements of Operations for the quarters ended March 31, 2024 and 2023 7 Unaudited Consolidated Statements of Comprehensive (Loss) Income for the quarters ended March 31, 2024 and 2023 8 Unaudited Consolidated Statements of Changes in Stockholders' Equity for the quarters ended March 31, 2024 and 2023 9 Unaudited Consolidated Statements of Cash Flows for the quarters ended March 31, 2024 and 2023 11 Notes to Unaudited Consolidated Financial Statements 13

Management's Discussion and Analysis of Financial

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 114

Quantitative and Qualitative Disclosures about

Item 3. Quantitative and Qualitative Disclosures about Market Risk 158

Controls and Procedures

Item 4. Controls and Procedures 158

– Other Information

Part II – Other Information

Legal Proceedings

Item 1. Legal Proceedings 159

Risk Factors

Item 1A. Risk Factors 159

Unregistered Sales of Equity Securities and

Item 2. Unregistered Sales of Equity Securities and

Use of Proceeds

Use of Proceeds 159

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 160

Mine Safety Disclosures

Item 4. Mine Safety Disclosures 160

Other information

Item 5. Other information 160

Exhibits

Item 6. Exhibits 161

Signatures

Signatures 162 3

Forward-Looking Statements

Forward-Looking Statements This Form 10-Q contains "forward-looking the meaning of the U.S. Private Securities Litigation Reform Act of 1995, including, without limitation, about Popular, 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 management's current expectations and, by their nature, involve risks, uncertainties, estimates and assumptions. Potential factors, some of which are beyond the Corporation's 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, capital markets conditions, capital adequacy and liquidity, and the effect of legal and regulatory proceedings and new accounting standards on the Corporation's 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

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

business

business and economic 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 non-performing 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 shareholders; the impact of bank failures or adverse developments at other banks and related negative 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 Government and the Federally-appointed oversight board on the economy, our customers and our business; the impact of the pending debt restructuring proceedings under Title III of the Puerto Rico Oversight, Management and Economic Stability Act ("PROMESA") and of other actions taken or to be taken to address Puerto Rico's fiscal challenges on the value of our portfolio of Puerto Rico government securities and loans to governmental entities and of our commercial, mortgage and consumer loan portfolios where private borrowers could be directly affected by governmental action; the amount of Puerto Rico public sector deposits held at the Corporation, whose futur

" of this report for a discussion of

Item 1A" of this report for a discussion of such factors and certain risks and uncertainties to which the Corporation is subject. 5 All forward-looking 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. 6 POPULAR, INC. CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (UNAUDITED) [UNAUDITED] March 31, December 31, (In thousands, except share information) 2024 2023 Assets: Cash and due from banks $ 320,486 $ 420,462 Money market investments: Time deposits with other banks 5,928,578 6,998,871 Total money market investments 5,928,578 6,998,871 Trading account debt securities, at fair value: Other trading account debt securities 27,308 31,568 Debt securities available-for-sale, at fair value: Pledged securities with creditors' right to repledge 41,261 72,827 Other debt securities available-for-sale 17,976,663 16,656,217 Debt securities available-for-sale 18,017,924 16,729,044 Less – Allowance for credit losses 500 - Debt securities available-for-sale, net 18,017,424 16,729,044 Debt securities held-to-maturity, at amortized cost: Pledged securities with creditors' right to repledge 27,372 27,083 Other debt securities held-to-maturity 8,055,788 8,167,252 Debt securities held-to-maturity (fair value 2024 - $ 7,958,326 ; 2023 - $ 8,159,385 ) 8,083,160 8,194,335 Less – Allowance for credit losses 5,731 5,780 Debt securities held-to-maturity, net 8,077,429 8,188,555 Equity securities (realizable value 2024 - $ 196,324 ; 2023 - $ 194,641 ) 195,747 193,726 Loans held-for-sale, at fair value 5,352 4,301 Loans held-in-portfolio 35,486,161 35,420,8

Financial Statements

Financial Statements. 11 POPULAR, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Quarters ended March 31, (In thousands) 2024 2023 Cash flows from operating activities: Net income $ 103,283 $ 158,979 Adjustments to reconcile net income to net cash provided by operating activities: Provision for credit losses 72,598 47,637 Amortization of intangibles 795 795 Depreciation and amortization of premises and equipment 15,361 13,842 Net accretion of discounts and amortization of premiums and deferred fees ( 51,360 ) ( 2,276 ) Interest capitalized on loans subject to the temporary payment moratorium or loss mitigation alternatives ( 1,641 ) ( 2,876 ) Share-based compensation 11,479 7,873 Fair value adjustments on mortgage servicing rights 3,439 1,376 Adjustments to indemnity reserves on loans sold 237 ( 612 ) Earnings from investments under the equity method, net of dividends or distributions ( 11,792 ) ( 8,621 ) Deferred income tax expense (benefit) 9,513 ( 2,064 ) Gain on: Disposition of premises and equipment and other productive assets ( 3,412 ) ( 2,423 ) Sale of loans, including valuation adjustments on loans held-for-sale and mortgage banking activities ( 74 ) ( 264 ) Sale of foreclosed assets, including write-downs ( 4,447 ) ( 5,228 ) Acquisitions of loans held-for-sale ( 324 ) ( 2,861 ) Proceeds from sale of loans held-for-sale 8,283 9,148 Net originations on loans held-for-sale ( 11,056 ) ( 21,790 ) Net decrease (increase) in: Trading debt securities 6,465 ( 1,055 ) Equity securities ( 1,995 ) ( 3,731 ) Accrued income receivable ( 22,719 ) 314 Other assets 38,702 25,072 Net (decrease) increase in: Interest payable ( 10,799 ) ( 2,846 ) Pension and other postretirement benefits obligation 916 4,038 Other liabilities 10,111 ( 59,381 ) Total adjustments 58,280 ( 5,933 ) Net cash provided by operating activities 161,563 153,046 Cash flows from investing activities: Net decrease (inc

Financial Statements

Financial Statements. 13 Notes to Consolidated Financial (Unaudited) Note 1 - Nature of operations 14 Note 2 - Basis of presentation 15 Note 3 - New accounting pronouncements 16 Note 4 - Restrictions on cash and due from banks and certain securities 19 Note 5 - Debt securities available-for-sale 20 Note 6 - Debt securities held-to-maturity 23 Note 7 - Loans 27 Note 8 - Allowance for credit losses – loans held-in- portfolio 36 Note 9 - Mortgage banking activities 66 Note 10 - Transfers of financial assets and mortgage servicing assets 67 Note 11 - Other real estate owned 70 Note 12 - Other assets 71 Note 13 - Goodwill and other intangible assets 72 Note 14 - Deposits 74 Note 15 - Borrowings 75 Note 16 - Other liabilities 77 Note 17 - Stockholders' equity 78 Note 18 - Other comprehensive income (loss) 79 Note 19 - Guarantees 81 Note 20 - Commitments and contingencies 83 Note 21- Non-consolidated variable interest entities 87 Note 22 - Related party transactions 89 Note 23 - Fair value measurement 90 Note 24 - Fair value of financial instruments 95 Note 25 - Net income per common share 98 Note 26 - Revenue from contracts with customers 99 Note 27 - Leases 101 Note 28 - Pension and postretirement benefits 103 Note 29 - Stock-based compensation 104 Note 30 - Income taxes 106 Note 31 - Supplemental disclosure on the consolidated 110 Note 32 - Segment reporting 111 14 Note 1 – Nature of Operations Popular, Inc. (the "Corporation" or "Popular") is a diversified, publicly-owned financial holding company the supervision and regulation of the Board of Governors of the Federal Reserve System. The Corporation has operations in Puerto Rico, the mainland United and the U.S. and British Virgin Islands. In Puerto Rico, the Corporation provides retail, mortgage, and commerc

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