July 23, 2010 / 5:40 PM / 7 years ago

TEX-S&P: Popular Inc ratings unaffected by results

  (The following statement was released by the rating agency)
  July 23 - Standard & Poor’s Ratings Services said today that its ratings on Popular Inc. (BPOP.O) (B/Positive/C) are not affected by the company’s second-quarter results, which we view as weak. Specifically, the holding company reported a net loss of nearly $56 million, in line with our expectations and smaller than the loss reported last quarter. Credit quality remained very poor, in our opinion, but showed some signs of stabilizing as further deterioration in the residential mortgage portfolio was partially offset by some improvement in the construction and commercial loan portfolios. Loan-loss provisions declined and covered net charge-offs. Capital ratios improved substantially, aided by $1.15 billion in capital issuance, which provides a cushion to absorb potential additional losses. In summary, we think the bank’s performance could continue to lag peers’ given the weak economic environment in Puerto Rico. However, the outlook is positive, in part due to the bank’s FDIC-supported acquisition of certain assets and deposits from Westerbank Puerto Rico and its planned sale of its EVERTEC transaction-processing subsidiary. Primary Credit Analyst: Robert Hansen, CFA, New York (1) 212-438-7402;
                     robert_hansen@standardandpoors.com Secondary Credit Analyst: Lidia Parfeniuk, Toronto (1) 416-507-2517;
                       lidia_parfeniuk@standardandpoors.com  (New York Ratings Team)   

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