OFG Bancorp (OFG) Q4 2025 earnings summary

Executive summary

• Diluted EPS rose to $1.27 in Q4, up 17% year-over-year, and full-year 2025 EPS reached $4.58, with total assets at $12.5 billion and customer deposits at $9.92 billion.

• Digital transformation drove a 90.2% increase in digital account openings and strong adoption of new products, supporting customer and deposit growth.

• Commercial loans increased to $3.5 billion, now 43% of the loan book, with new loan production up 11.5% to $2.6 billion for the year.

• $92 million in share repurchases and a 20% dividend increase in 2025, reflecting strong capital management.

• Asset quality and credit metrics remained stable, with a 4.26% increase in client base and continued digital innovation.

Financial highlights

• Q4 core revenues were $185.4 million, with net interest margin at 5.12% and full-year core revenues at $729.8 million.

• Total interest income was $197 million, down $2.9 million sequentially; interest expense decreased $0.9 million.

• Noninterest expenses totaled $105 million, up $8.5 million, reflecting higher professional fees, business sizing, and performance bonuses.

• Income tax benefit of $8.5 million in Q4, driven by $16.8 million in discrete tax benefits, including $12.9 million from a tax agreement expiration.

• Tangible book value per share was $29.96 at year-end.

Outlook and guidance

• Expect low single-digit loan growth in 2026, with commercial loans up 5-6% and auto loans down 2-3%.

• Net interest margin guidance for 2026 is 4.95%-5.05%, reflecting funding mix changes and rate cuts.

• Non-interest expense expected to be $380-$385 million in 2026, flat year-over-year, with further efficiencies anticipated in 2027-2028.

• Effective tax rate for 2026 projected at 23%, excluding discrete items.

• Digital investments and operational efficiencies expected to drive further growth and market share expansion.