Popular (BPOP) RBC Capital Markets Global Financial Institutions Conference 2025 summary

Economic environment and outlook

• Puerto Rico's unemployment rate is at a historic low of 5.4%, with higher workforce participation despite a smaller population.

• Minimum wage has increased by about 40% over four years, supporting wage growth and economic stability.

• Federal funds remain a significant economic tailwind, with $45 billion obligated and $4–$6 billion disbursed annually for reconstruction.

• Private investment is rising, especially in luxury real estate and large hotel projects across the island.

• Puerto Rico's GDP is around $80 billion, with manufacturing accounting for about half.

Industry trends and regulatory environment

• Onshoring and tariffs may drive more manufacturing to Puerto Rico, leveraging existing pharma and biotech capacity.

• Regulatory clarity and tailored supervision are sought, especially regarding thresholds and enforcement consistency.

• Stress testing remains a key discipline, with expectations for more clarity and less volatility in results.

• Anticipates fewer new regulations but remains cautious about potential changes in enforcement.

Lending and growth strategies

• U.S. lending focuses on community association, healthcare, and multifamily construction, with strong demand in Florida and New York.

• Puerto Rico sees broad-based commercial lending demand, supported by tax incentives and attractive pricing.

• Consumer lending is diverse, with credit cards, unsecured personal loans, and auto lending performing well.

• Targeting 3–5% consolidated loan growth for the year, with disciplined risk management in condo association lending.