First BanCorp (FBP) investor relations material

Executive summary

• Net income for Q2 2026 was $96.1 million ($0.62 per diluted share), up 20%-24% year-over-year and 8% sequentially, reflecting strong profitability, operational discipline, and robust shareholder returns.

• Adjusted pre-tax, pre-provision income reached a record $137.5 million, with return on average assets at 2.02% and efficiency ratio improved to 48.07%.

• Loan growth accelerated, especially in commercial and construction segments in Puerto Rico and Florida, with total loans at $13.3 billion, up 5.2% annualized.

• Deposits increased by $274 million, mainly from government and core customers, and asset quality remained stable with non-performing assets at 0.59%.

• 84%-100% of earnings were returned to shareholders via $50 million in share repurchases and $31 million in dividends, while maintaining a CET1 ratio of 16.96%-17%.

Financial highlights

• Net interest income rose to $229.1 million, up $8.1 million sequentially and $13.2 million year-over-year, driven by higher yields and loan growth.

• Net interest margin expanded to 4.87%, up 12-31 basis points sequentially, aided by refinancing and asset mix optimization.

• Non-interest income was $35.7 million, with gains from tax credits and card processing offsetting lower insurance commissions.

• Non-interest expenses were $127.3 million, stable sequentially, with higher compensation and professional fees.

• Efficiency ratio improved to 48.07% from 49.14% in Q1 2026 and 49.97% YoY.

Outlook and guidance

• Management targets 3%-5% organic loan growth, a 50%-52% efficiency ratio, and aims to return close to 100% of annual earnings to shareholders.

• Net interest margin expected to expand by 3-5 basis points per quarter for the rest of 2026, assuming no rate cuts.

• Focus remains on operational efficiency, prudent risk management, and digital transformation.

• Quarterly operating expenses (excluding OREO gains/losses) projected at $128-$130 million for the remainder of 2026.

• Loan pipelines remain healthy, supporting confidence in achieving full-year growth targets.