Profile: Popular Inc (BPOP.O)

BPOP.O on Nasdaq

31.56USD
22 Sep 2014
Price Change (% chg)

$-0.80 (-2.47%)
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Popular, Inc. (Popular), incorporated on November 20, 1984, is a diversified, publicly owned bank holding company. The Company operates in two markets: Puerto Rico and Mainland United States. In Puerto Rico market the Company provides retail and commercial banking services through its principal banking subsidiary, Banco Popular de Puerto Rico (BPPR), as well as auto and equipment leasing and financing, mortgage loans, investment banking, broker-dealer and insurance services through specialized subsidiaries. In Mainland United States market, the Company operates Banco Popular North America (BPNA). BPNA is a community bank providing a range of financial services and products to the communities it serves. BPNA operates branches in New York, California, Illinois, New Jersey and Florida. In September 2014, the Company announced that it has completed the sale of its Central Florida regional operations to Harbor Community Bank, a wholly owned subsidiary of HCBF Holding Company, Inc.

Puerto Rico Business

BPPR accounted for 75% of its total consolidated assets at December 31, 2012. BPPR has retail franchise in Puerto Rico, with 175 branches and 597 automatic teller machines (ATM). BPPR also operates eight branches in the United States. Virgin Islands, one branch in the British Virgin Islands and one branch in New York. In 2012, in Virgin Islands, BPPR had 20 ATMs. BPPR’s deposits are insured under the Deposit Insurance Fund (DIF) of the Federal Deposit Insurance Corporation.

BPPR has two principal subsidiaries: Popular Auto, Inc., which is a vehicle and equipment financing, leasing and daily rental company, and Popular Mortgage, Inc., a mortgage loan company with 37 offices in Puerto Rico. In addition, BPPR has various subsidiaries holding specific assets acquired in satisfaction of loans for real estate development projects and commercial loans. Its Puerto Rico operations also include financial advisory, investment and securities brokerage services for institutional and retail customers through Popular Securities, Inc., a wholly owned subsidiary of Popular. Popular Securities, Inc. is a securities broker-dealer with operations in Puerto Rico. As of December 31, 2012, Popular Securities had $317.4 million in total assets and $4.6 billion in assets under management.

The Company offers insurance and reinsurance services through Popular Insurance, Inc., a general insurance agency, and Popular Life RE, a reinsurance company, with total revenues of $29.9 million and $17.7 million, respectively, for the year ended December 31, 2012. It also own Popular Risk Services, Inc., an insurance broker, and Popular Insurance V.I., Inc., an insurance agency operating in the Virgin Islands.

Commercial loans are consists of commercial and industrial (C&I) loans to commercial customers for use in normal business operations to finance working capital needs, equipment purchases or other projects, and commercial real estate (CRE) loans (excluding construction loans) for income producing real estate properties. C&I loans are underwritten individually and usually secured with the assets of the Company and the personal guarantee of the business owners. CRE loans consist of loans for income producing real estate properties and real estate developers and the financing of owner-occupied facilities if there is real estate as collateral. Total commercial loans in Puerto Rico were $6.3 billion as of December 31, 2012, and represented 41% of our total loan portfolio in Puerto Rico.

Construction loans are CRE loans to companies or developers used for the construction of a commercial or residential property, for which repayment will be generated by the sale or permanent financing of the property. Its construction loan portfolio primarily consists of retail, residential (land and condominiums), office and warehouse product types. Total construction loans in Puerto Rico were $212.3 million as of December 31, 2012, and represented 1% of its total loan portfolio in Puerto Rico.

Lease financings are consists of automobile loans/leases made through automotive dealerships and equipment lease financings. Total lease financings in Puerto Rico were $540.5 million as of December 31, 2011. Mortgage loans mortgage loans to consumers for the purchase or refinancing of a residence and also include residential construction loans made to individuals for the construction or refurbishment of their residence. The majority of these loans are financed over a 15 to 30 year term, and in most cases, the loans are extended to borrowers to finance their primary residence. In some cases, government agencies or private mortgage insurers guarantee the loan. Total mortgage loans in Puerto Rico were $4.9 billion as of December 31, 2012, and represented 32% of its total loan portfolio in Puerto Rico.

Consumer loans include personal loans, equity lines of credit (HELOCs) and other loans made by banks to individual borrowers. In this area, BPPR offers four unsecured products: personal loans, credit cards, personal credit lines and overdraft protection. All other consumer loans are secured. HELOCs includes both home equity loans and lines of credit secured by a first or second mortgage on the borrower’s residence, which allows customers to borrow against the equity in their homes. Total consumer loans in Puerto Rico were $3 billion as of December 31, 2012, and represented 21% of its total loan portfolio in Puerto Rico.

The Company refers to the loans acquired in the Westernbank FDIC-assisted transaction, except credit cards, as covered loans as BPPR will be reimbursed by the FDIC for a substantial portion of any future losses on such loans under the terms of the loss sharing agreements. At December 31, 2012, covered loans totaled $3.8billion.

Mainland United States Business

Popular North America, Inc. (PNA) functions as the holding company for its operations in the mainland United States. As of December 31, 2012, PNA had one principal subsidiary which was BPNA, a full service commercial bank incorporated in the state of New York. The banking operations of BPNA in the United States mainland are based in five states, including New York, Illinois, California, Florida and New Jersey. In addition, BPNA owns E-LOAN, Popular Equipment Finance, Inc., and Popular Insurance Agency USA, Inc. E-LOAN’s business consists solely of providing an online platform to raise deposits for BPNA. E-LOAN markets deposit accounts under its name for the benefit of BPNA. At December 31, 2012, E-LOAN’s total assets amounted to $367.4 million. Popular Insurance Agency USA, Inc. acts as an insurance agent or broker for issuing insurance across the BPNA branch network. Total revenues of Popular Insurance Agency USA, Inc. for the year ended December 31, 2012 totaled $5.4 million.

Commercial loans consisted of C&I loans to commercial customers for use in normal business operations to finance working capital needs, equipment purchases or other projects, and commercial real estate (CRE) loans (excluding construction loans) for income producing real estate properties. CRE loans consist of loans for income producing real estate properties and real estate developers and the financing of owner-occupied facilities if there is real estate as collateral. Total commercial loans at BPNA were $4.1 billion as of December 31, 2012, and represented 62% of its total loan portfolio in the United States.

The legacy portfolio is comprised of commercial loans, construction loans and lease financings related to certain lending products exited by the Corporation as part of restructuring efforts carried its in prior years at BPNA. Total legacy portfolio at BPNA was $384.2 million as of December 31, 2012, and represented 7% of its total loan portfolio in the United States. Mortgage loans include residential mortgage loans to consumers for the purchase or refinancing of a residence and also includes residential construction loans made to individuals for the construction or refurbishment of their residence. The majority of these loans are financed over a 15 to 30 year term, and in most cases, the loans are extended to borrowers to finance their primary residence. In some cases, government agencies or private mortgage insurers guarantee the loan. Total mortgage loans at BPNA were $1.1 billion as of December 31, 2012, and represented 20% of its total loan portfolio in the United States.

Consumer loans include personal loans, credit cards, auto loans, HELOCs and other loans made by banks to individual borrowers. In this area, BPNA offers four unsecured products: personal loans, credit cards, personal credit lines and overdraft protection. All other consumer loans are secured. Total consumer loans at BPNA were $634.6 million as of December 31, 2012, and represented 11% of its total loan portfolio in the United States.

Company Address

Popular Inc

POPULAR CENTER BUILDING
209 Munoz Rivera Avenue, Hato Re
SAN JUAN     00918
P: +1787.7659800

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