First BanCorp (FBP) Q3 2024 earnings summary

Executive summary

• Net income for Q3 2024 was $73.7 million ($0.45 per share), down from $75.8 million in Q2 2024 and $82.0 million in Q3 2023, with a return on assets of 1.55% and return on average equity of 18.31%.

• Loan portfolio grew by $62.8 million despite $122 million in unexpected commercial prepayments, supported by strong commercial originations.

• Over 100% of quarterly earnings were deployed for redemption of $50 million in junior subordinated debentures and common stock dividends.

• Tangible book value per share increased to $10.09, and capital ratios improved.

• Asset quality remained strong, with non-performing assets down to 63 basis points of total assets.

Financial highlights

• Net interest income rose to $202.1 million, up $2.5 million from last quarter, driven by higher loan volumes and an extra day in the quarter.

• Net interest margin expanded to 4.25% in Q3 2024, up from 4.22% in Q2 2024.

• Non-interest income was $32.5 million, aided by insurance proceeds and higher card/processing income.

• Non-interest expenses increased to $122.9 million, mainly due to higher compensation, technology costs, and an extra working day.

• Efficiency ratio was 52.41%, up from 51.23% in Q2 2024.

Outlook and guidance

• Loan growth for 2024 is now expected closer to 4% due to higher prepayments, with mid-single digit growth targeted for 2025.

• Net interest margin expected to remain flat in Q4 2024, with improvements anticipated in 2025 as rates decline and bond book repricing supports NII expansion.

• Expense base projected at $123–$124 million per quarter through 2025, with efficiency ratio around 52%.

• Management focus remains on expanding relationships, building loan pipelines, and digital transformation.