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Allowance for loan losses | 12 Months Ended
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Dec. 31, 2019
Receivables |
Allowance for loan losses | Note 9 – Allowance for loan losses The Corporation follows a systematic methodology to establish and evaluate the adequacy of the allowance for loan losses (“ALLL”) to provide for inherent losses in the loan portfolio. This methodology includes the consideration of factors such as current economic conditions, portfolio risk characteristics, prior loss experience and results of periodic credit reviews of individual loans. The provision for loan losses charged to current operations is based on this methodology. Loan losses are charged and recoveries are credited to the ALLL. The Corporation’s assessment of the ALLL is determined in accordance with the guidance of loss contingencies in ASC Subtopic 450-20 and loan impairment guidance in ASC Section 310-10-35. Also, the Corporation determines the ALLL on purchased impaired loans and purchased loans accounted for under ASC Subtopic 310-30, by evaluating decreases in expected cash flows after the acquisition date. The accounting guidance provides for the recognition of a loss allowance for groups of homogeneous loans. The determination of the general ALLL includes the following principal factors:  Base net loss rates, which are based on the moving average of annualized net loss rates computed over a 5-year historical loss period for the commercial and construction loan portfolios, and an 18-month period for the consumer and mortgage loan portfolios. The base net loss rates are applied by loan type and by legal entity.  Recent loss trend adjustment, which replaces the base loss rate with a 12-month average loss rate, when these trends are higher than the respective base loss rates. The objective of this adjustment is to allow for a more recent loss trend to be captured and reflected in the ALLL estimation process.  For the period ended December 31, 2019, 25% (December 31, 2018 - 26%) of the ALLL for the BPPR segment loan portfolios utilized the recent loss trend adjustment instead of the base loss. The effect of replacing the base loss with the recent loss trend adjustment was mainly concentrated in the leasing, auto and commercial real estate non-owner occupied portfolios for 2019 and in the commercial, mortgage, and overall consumer portfolios for 2018.  For the period ended December 31, 2019, 21% (December 31, 2018 - 28 %) of the Popular U.S. segment loan portfolios utilized the recent loss trend adjustment instead of the base loss. The effect of replacing the base loss with the recent loss trend adjustment was concentrated in the commercial multi-family, legacy, commercial real estate owner occupied and construction portfolios for 2019 and in the consumer portfolio for 2018.  Environmental factors, which include credit and macroeconomic indicators such as unemployment rate, economic activity index and delinquency rates, adopted to account for current market conditions that are likely to cause estimated credit losses to differ from historical losses. The Corporation reflects the effect of these environmental factors on each loan group as an adjustment that, as appropriate, increases the historical loss rate applied to each group. Environmental factors provide updated perspective on credit and economic conditions. Regression analysis is used to select these indicators and quantify the effect on the general ALLL. The Corporation’s methodology also includes qualitative judgmental reserves based on stressed credit quality assumptions to provide for probable losses in the loan portfolios not embedded in the historical loss rates. During the third quarter of 2019, management completed the recalibration analysis of the environmental factors adjustments. The environmental factors adjustments are developed by performing regression analyses on selected credit and economic indicators for each applicable loan segment. The environmental factor models used to account for changes in current credit and macroeconomic conditions were reviewed and recalibrated based on the latest applicable trends. The effect of the recalibration resulted in an increase of $4.6 million to the environmental factors adjustments reserve at the Popular U.S. segment. The following tables present the changes in the allowance for loan losses, loan ending balances and whether such loans and the allowance pertain to loans individually or collectively evaluated for impairment for the years ended December 31, 2019 and 2018.
For the year ended December 31, 2019
Puerto Rico
(In thousands) | Commercial |  | Construction |  | Mortgage |  | Leasing |  | Consumer |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | 207,214 |  | $ | 886 |  | $ | 142,978 |  | $ | 11,486 |  | $ | 144,594 |  | $ | 507,158
| Provision (reversal of provision) |  | (41,440) |  |  | (3,417) |  |  | 14,658 |  |  | 8,619 |  |  | 157,331 |  |  | 135,751
| Charge-offs |  | (53,852) |  |  | (109) |  |  | (47,577) |  |  | (11,834) |  |  | (167,983) |  |  | (281,355)
| Recoveries |  | 19,141 |  |  | 3,214 |  |  | 6,222 |  |  | 2,497 |  |  | 40,023 |  |  | 71,097
Ending balance | $ | 131,063 |  | $ | 574 |  | $ | 116,281 |  | $ | 10,768 |  | $ | 173,965 |  | $ | 432,651
Specific ALLL | $ | 20,533 |  | $ | 6 |  | $ | 40,596 |  | $ | 61 |  | $ | 20,259 |  | $ | 81,455
General ALLL | $ | 110,530 |  | $ | 568 |  | $ | 75,685 |  | $ | 10,707 |  | $ | 153,706 |  | $ | 351,196
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired loans | $ | 397,452 |  | $ | 119 |  | $ | 522,469 |  | $ | 507 |  | $ | 91,157 |  | $ | 1,011,704
Loans held-in-portfolio excluding impaired loans |  | 6,863,678 |  |  | 137,351 |  |  | 5,644,279 |  |  | 1,059,000 |  |  | 5,464,220 |  |  | 19,168,528
Total loans held-in-portfolio | $ | 7,261,130 |  | $ | 137,470 |  | $ | 6,166,748 |  | $ | 1,059,507 |  | $ | 5,555,377 |  | $ | 20,180,232
For the year ended December 31, 2019
Popular U.S.
(In thousands) | Commercial |  | Construction |  | Mortgage |  | Legacy |  | Consumer |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | 31,901 |  | $ | 6,538 |  | $ | 4,434 |  | $ | 969 |  | $ | 18,348 |  | $ | 62,190
| Provision (reversal of provision) |  | 15,496 |  |  | (127) |  |  | 828 |  |  | (1,738) |  |  | 15,569 |  |  | 30,028
| Charge-offs |  | (40,329) |  |  | (2,215) |  |  | (605) |  |  | 105 |  |  | (21,280) |  |  | (64,324)
| Recoveries |  | 8,921 |  |  | 8 |  |  | 170 |  |  | 1,294 |  |  | 6,770 |  |  | 17,163
Ending balance | $ | 15,989 |  | $ | 4,204 |  | $ | 4,827 |  | $ | 630 |  | $ | 19,407 |  | $ | 45,057
Specific ALLL | $ | - |  | $ | - |  | $ | 2,208 |  | $ | - |  | $ | 1,563 |  | $ | 3,771
General ALLL | $ | 15,989 |  | $ | 4,204 |  | $ | 2,619 |  | $ | 630 |  | $ | 17,844 |  | $ | 41,286
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired loans | $ | 2,097 |  | $ | - |  | $ | 9,386 |  | $ | - |  | $ | 9,634 |  | $ | 21,117
Loans held-in-portfolio excluding impaired loans |  | 5,049,524 |  |  | 693,622 |  |  | 1,007,398 |  |  | 22,105 |  |  | 432,875 |  |  | 7,205,524
Total loans held-in-portfolio | $ | 5,051,621 |  | $ | 693,622 |  | $ | 1,016,784 |  | $ | 22,105 |  | $ | 442,509 |  | $ | 7,226,641
For the year ended December 31, 2019
Popular, Inc.
(In thousands) | Commercial |  | Construction |  | Mortgage |  | Legacy | Leasing |  | Consumer |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | 239,115 |  | $ | 7,424 |  | $ | 147,412 |  | $ | 969 | $ | 11,486 |  | $ | 162,942 |  | $ | 569,348
| Provision (reversal of provision) |  | (25,944) |  |  | (3,544) |  |  | 15,486 |  |  | (1,738) |  | 8,619 |  |  | 172,900 |  |  | 165,779
| Charge-offs |  | (94,181) |  |  | (2,324) |  |  | (48,182) |  |  | 105 |  | (11,834) |  |  | (189,263) |  |  | (345,679)
| Recoveries |  | 28,062 |  |  | 3,222 |  |  | 6,392 |  |  | 1,294 |  | 2,497 |  |  | 46,793 |  |  | 88,260
Ending balance | $ | 147,052 |  | $ | 4,778 |  | $ | 121,108 |  | $ | 630 | $ | 10,768 |  | $ | 193,372 |  | $ | 477,708
Specific ALLL | $ | 20,533 |  | $ | 6 |  | $ | 42,804 |  | $ | - | $ | 61 |  | $ | 21,822 |  | $ | 85,226
General ALLL | $ | 126,519 |  | $ | 4,772 |  | $ | 78,304 |  | $ | 630 | $ | 10,707 |  | $ | 171,550 |  | $ | 392,482
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired loans | $ | 399,549 |  | $ | 119 |  | $ | 531,855 |  | $ | - | $ | 507 |  | $ | 100,791 |  | $ | 1,032,821
Loans held-in-portfolio excluding impaired loans |  | 11,913,202 |  |  | 830,973 |  |  | 6,651,677 |  |  | 22,105 |  | 1,059,000 |  |  | 5,897,095 |  |  | 26,374,052
Total loans held-in-portfolio | $ | 12,312,751 |  | $ | 831,092 |  | $ | 7,183,532 |  | $ | 22,105 | $ | 1,059,507 |  | $ | 5,997,886 |  | $ | 27,406,873
For the year ended December 31, 2018
Puerto Rico - Non-covered loans
(In thousands) | Commercial |  | Construction |  | Mortgage |  | Leasing |  | Consumer |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | 171,531 |  | $ | 1,286 |  | $ | 159,081 |  | $ | 11,991 |  | $ | 174,215 |  | $ | 518,104
| Provision (reversal of provision) |  | 101,614 |  |  | (1,754) |  |  | 15,297 |  |  | 5,525 |  |  | 75,779 |  |  | 196,461
| Charge-offs |  | (82,352) |  |  | (9) |  |  | (69,393) |  |  | (8,297) |  |  | (138,161) |  |  | (298,212)
| Recoveries |  | 16,421 |  |  | 1,363 |  |  | 4,571 |  |  | 2,267 |  |  | 32,573 |  |  | 57,195
| Allowance transferred from covered loans |  | - |  |  | - |  |  | 33,422 |  |  | - |  |  | 188 |  |  | 33,610
Ending balance | $ | 207,214 |  | $ | 886 |  | $ | 142,978 |  | $ | 11,486 |  | $ | 144,594 |  | $ | 507,158
Specific ALLL | $ | 52,190 |  | $ | 56 |  | $ | 38,760 |  | $ | 320 |  | $ | 24,083 |  | $ | 115,409
General ALLL | $ | 155,024 |  | $ | 830 |  | $ | 104,218 |  | $ | 11,166 |  | $ | 120,511 |  | $ | 391,749
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired non-covered loans | $ | 398,518 |  | $ | 1,788 |  | $ | 509,468 |  | $ | 1,099 |  | $ | 104,235 |  | $ | 1,015,108
Non-covered loans held-in-portfolio excluding impaired loans |  | 6,974,125 |  |  | 84,167 |  |  | 5,923,855 |  |  | 933,674 |  |  | 4,952,543 |  |  | 18,868,364
Total non-covered loans held-in-portfolio | $ | 7,372,643 |  | $ | 85,955 |  | $ | 6,433,323 |  | $ | 934,773 |  | $ | 5,056,778 |  | $ | 19,883,472
For the year ended December 31, 2018
Puerto Rico - Covered Loans
(In thousands) | Commercial |  | Construction |  | Mortgage |  | Leasing |  | Consumer |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | - |  | $ | - |  | $ | 32,521 |  | $ | - |  | $ | 723 |  | $ | 33,244
| Provision (reversal of provision) |  | - |  |  | - |  |  | 2,265 |  |  | - |  |  | (535) |  |  | 1,730
| Charge-offs |  | - |  |  | - |  |  | (1,446) |  |  | - |  |  | (2) |  |  | (1,448)
| Recoveries |  | - |  |  | - |  |  | 82 |  |  | - |  |  | 2 |  |  | 84
| Allowance transferred to non-covered loans |  | - |  |  | - |  |  | (33,422) |  |  | - |  |  | (188) |  |  | (33,610)
Ending balance | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | -
Specific ALLL | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | -
General ALLL | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | -
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired covered loans | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | -
Covered loans held-in-portfolio excluding impaired loans |  | - |  |  | - |  |  | - |  |  | - |  |  | - |  |  | -
Total covered loans held-in-portfolio | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | -
For the year ended December 31, 2018
Popular U.S.
(In thousands) | Commercial |  | Construction |  | Mortgage |  | Legacy |  | Consumer |  | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | 44,134 |  | $ | 7,076 |  | $ | 4,541 |  | $ | 798 |  | $ | 15,529 |  | $ | 72,078
| Provision (reversal of provision) |  | 7,551 |  |  | 5,268 |  |  | (478) |  |  | (1,861) |  |  | 19,401 |  |  | 29,881
| Charge-offs |  | (24,920) |  |  | (5,806) |  |  | (232) |  |  | 114 |  |  | (22,118) |  |  | (52,962)
| Recoveries |  | 5,136 |  |  | - |  |  | 603 |  |  | 1,918 |  |  | 5,536 |  |  | 13,193
Ending balance | $ | 31,901 |  | $ | 6,538 |  | $ | 4,434 |  | $ | 969 |  | $ | 18,348 |  | $ | 62,190
Specific ALLL | $ | - |  | $ | - |  | $ | 2,451 |  | $ | - |  | $ | 1,810 |  | $ | 4,261
General ALLL | $ | 31,901 |  | $ | 6,538 |  | $ | 1,983 |  | $ | 969 |  | $ | 16,538 |  | $ | 57,929
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired loans | $ | - |  | $ | 12,060 |  | $ | 9,420 |  | $ | - |  | $ | 8,507 |  | $ | 29,987
Loans held-in-portfolio excluding impaired loans |  | 4,670,376 |  |  | 681,434 |  |  | 792,515 |  |  | 25,949 |  |  | 424,156 |  |  | 6,594,430
Total loans held-in-portfolio | $ | 4,670,376 |  | $ | 693,494 |  | $ | 801,935 |  | $ | 25,949 |  | $ | 432,663 |  | $ | 6,624,417
For the year ended December 31, 2018
Popular, Inc.
(In thousands) | Commercial | Construction | Mortgage | Legacy | Leasing | Consumer | Total
Allowance for credit losses: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Beginning balance | $ | 215,665 | $ | 8,362 | $ | 196,143 | $ | 798 | $ | 11,991 | $ | 190,467 | $ | 623,426
| Provision (reversal of provision) |  | 109,165 |  | 3,514 |  | 17,084 |  | (1,861) |  | 5,525 |  | 94,645 |  | 228,072
| Charge-offs |  | (107,272) |  | (5,815) |  | (71,071) |  | 114 |  | (8,297) |  | (160,281) |  | (352,622)
| Recoveries |  | 21,557 |  | 1,363 |  | 5,256 |  | 1,918 |  | 2,267 |  | 38,111 |  | 70,472
Ending balance | $ | 239,115 | $ | 7,424 | $ | 147,412 | $ | 969 | $ | 11,486 | $ | 162,942 | $ | 569,348
Specific ALLL | $ | 52,190 | $ | 56 | $ | 41,211 | $ | - | $ | 320 | $ | 25,893 | $ | 119,670
General ALLL | $ | 186,925 | $ | 7,368 | $ | 106,201 | $ | 969 | $ | 11,166 | $ | 137,049 | $ | 449,678
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |
Impaired loans | $ | 398,518 | $ | 13,848 | $ | 518,888 | $ | - | $ | 1,099 | $ | 112,742 | $ | 1,045,095
Loans held-in-portfolio excluding impaired loans |  | 11,644,501 |  | 765,601 |  | 6,716,370 |  | 25,949 |  | 933,674 |  | 5,376,699 |  | 25,462,794
Total loans held-in-portfolio | $ | 12,043,019 | $ | 779,449 | $ | 7,235,258 | $ | 25,949 | $ | 934,773 | $ | 5,489,441 | $ | 26,507,889
The following table provides the activity in the allowance for loan losses related to loans accounted for pursuant to ASC Subtopic 310-30.
| ASC 310-30
| For the years ended
(In thousands) | December 31, 2019 |  | December 31, 2018
Balance at beginning of period | $ | 122,135 |  | $ | 119,505
Provision |  | 1,119 |  |  | 61,270
Net charge-offs |  | (49,215) |  |  | (58,640)
Balance at end of period | $ | 74,039 |  | $ | 122,135
Impaired loans The following tables present loans individually evaluated for impairment at December 31, 2019 and 2018.
December 31, 2019
Puerto Rico
| Impaired Loans – With an | Impaired Loans |  |  |  |  |  |
| Allowance | With No Allowance | Impaired Loans - Total
|  |  | Unpaid |  |  |  |  | Unpaid |  |  | Unpaid |  |
| Recorded | principal | Related | Recorded | principal | Recorded | principal |  | Related
(In thousands) | investment | balance | allowance | investment | balance | investment | balance |  | allowance
Commercial multi-family | $ | 1,196 | $ | 1,229 | $ | 4 | $ | 1,017 | $ | 1,247 | $ | 2,213 | $ | 2,476 | $ | 4
Commercial real estate non-owner occupied |  | 44,975 |  | 45,803 |  | 12,281 |  | 149,587 |  | 173,124 |  | 194,562 |  | 218,927 |  | 12,281
Commercial real estate owner occupied |  | 105,841 |  | 122,814 |  | 5,077 |  | 26,365 |  | 58,540 |  | 132,206 |  | 181,354 |  | 5,077
Commercial and industrial |  | 43,640 |  | 47,611 |  | 3,171 |  | 24,831 |  | 44,255 |  | 68,471 |  | 91,866 |  | 3,171
Construction |  | 119 |  | 119 |  | 6 |  | - |  | - |  | 119 |  | 119 |  | 6
Mortgage |  | 420,949 |  | 479,936 |  | 40,596 |  | 101,520 |  | 134,331 |  | 522,469 |  | 614,267 |  | 40,596
Leasing |  | 507 |  | 507 |  | 61 |  | - |  | - |  | 507 |  | 507 |  | 61
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  | 24,475 |  | 24,475 |  | 2,957 |  | - |  | - |  | 24,475 |  | 24,475 |  | 2,957
Personal |  | 65,521 |  | 65,521 |  | 17,142 |  | - |  | - |  | 65,521 |  | 65,521 |  | 17,142
Auto |  | 310 |  | 310 |  | 51 |  | - |  | - |  | 310 |  | 310 |  | 51
Other |  | 851 |  | 851 |  | 109 |  | - |  | - |  | 851 |  | 851 |  | 109
Total Puerto Rico | $ | 708,384 | $ | 789,176 | $ | 81,455 | $ | 303,320 | $ | 411,497 | $ | 1,011,704 | $ | 1,200,673 | $ | 81,455
December 31, 2019
Popular U.S.
| Impaired Loans – With an | Impaired Loans |  |  |  |  |  |
| Allowance | With No Allowance | Impaired Loans - Total
|  |  | Unpaid |  |  |  |  | Unpaid |  |  | Unpaid |  |
| Recorded | principal | Related | Recorded | principal | Recorded | principal | Related
(In thousands) | investment | balance | allowance | investment | balance | investment | balance | allowance
Commercial multi-family | $ | - | $ | - | $ | - | $ | 2,097 | $ | 2,539 | $ | 2,097 | $ | 2,539 | $ | -
Mortgage |  | 6,906 |  | 7,257 |  | 2,208 |  | 2,480 |  | 2,844 |  | 9,386 |  | 10,101 |  | 2,208
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
HELOCs |  | 6,691 |  | 6,691 |  | 1,560 |  | 2,829 |  | 3,087 |  | 9,520 |  | 9,778 |  | 1,560
Personal |  | 26 |  | 26 |  | 3 |  | 88 |  | 88 |  | 114 |  | 114 |  | 3
Total Popular U.S. | $ | 13,623 | $ | 13,974 | $ | 3,771 | $ | 7,494 | $ | 8,558 | $ | 21,117 | $ | 22,532 | $ | 3,771
December 31, 2019
Popular, Inc.
| Impaired Loans – With an | Impaired Loans |  |  |  |  |  |
| Allowance | With No Allowance | Impaired Loans - Total
|  |  | Unpaid |  |  |  |  | Unpaid |  |  | Unpaid |  |
| Recorded | principal | Related | Recorded | principal | Recorded | principal | Related
(In thousands) | investment | balance | allowance | investment | balance | investment | balance | allowance
Commercial multi-family | $ | 1,196 | $ | 1,229 | $ | 4 | $ | 3,114 | $ | 3,786 | $ | 4,310 | $ | 5,015 | $ | 4
Commercial real estate non-owner occupied |  | 44,975 |  | 45,803 |  | 12,281 |  | 149,587 |  | 173,124 |  | 194,562 |  | 218,927 |  | 12,281
Commercial real estate owner occupied |  | 105,841 |  | 122,814 |  | 5,077 |  | 26,365 |  | 58,540 |  | 132,206 |  | 181,354 |  | 5,077
Commercial and industrial |  | 43,640 |  | 47,611 |  | 3,171 |  | 24,831 |  | 44,255 |  | 68,471 |  | 91,866 |  | 3,171
Construction |  | 119 |  | 119 |  | 6 |  | - |  | - |  | 119 |  | 119 |  | 6
Mortgage |  | 427,855 |  | 487,193 |  | 42,804 |  | 104,000 |  | 137,175 |  | 531,855 |  | 624,368 |  | 42,804
Leasing |  | 507 |  | 507 |  | 61 |  | - |  | - |  | 507 |  | 507 |  | 61
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  | 24,475 |  | 24,475 |  | 2,957 |  | - |  | - |  | 24,475 |  | 24,475 |  | 2,957
HELOCs |  | 6,691 |  | 6,691 |  | 1,560 |  | 2,829 |  | 3,087 |  | 9,520 |  | 9,778 |  | 1,560
Personal |  | 65,547 |  | 65,547 |  | 17,145 |  | 88 |  | 88 |  | 65,635 |  | 65,635 |  | 17,145
Auto |  | 310 |  | 310 |  | 51 |  | - |  | - |  | 310 |  | 310 |  | 51
Other |  | 851 |  | 851 |  | 109 |  | - |  | - |  | 851 |  | 851 |  | 109
Total Popular, Inc. | $ | 722,007 | $ | 803,150 | $ | 85,226 | $ | 310,814 | $ | 420,055 | $ | 1,032,821 | $ | 1,223,205 | $ | 85,226
December 31, 2018
Puerto Rico
| Impaired Loans – With an | Impaired Loans |  |  |  |  |  |
| Allowance | With No Allowance | Impaired Loans - Total
|  |  | Unpaid |  |  |  |  | Unpaid |  |  | Unpaid |  |
| Recorded | principal | Related | Recorded | principal | Recorded | principal |  | Related
(In thousands) | investment | balance | allowance | investment | balance | investment | balance |  | allowance
Commercial multi-family | $ | 932 | $ | 932 | $ | 4 | $ | - | $ | - | $ | 932 | $ | 932 | $ | 4
Commercial real estate non-owner occupied |  | 85,583 |  | 86,282 |  | 27,494 |  | 96,005 |  | 138,378 |  | 181,588 |  | 224,660 |  | 27,494
Commercial real estate owner occupied |  | 113,592 |  | 132,677 |  | 7,857 |  | 26,474 |  | 60,485 |  | 140,066 |  | 193,162 |  | 7,857
Commercial and industrial |  | 65,208 |  | 67,094 |  | 16,835 |  | 10,724 |  | 20,968 |  | 75,932 |  | 88,062 |  | 16,835
Construction |  | 1,788 |  | 1,788 |  | 56 |  | - |  | - |  | 1,788 |  | 1,788 |  | 56
Mortgage |  | 408,767 |  | 458,010 |  | 38,760 |  | 100,701 |  | 135,084 |  | 509,468 |  | 593,094 |  | 38,760
Leasing |  | 1,099 |  | 1,099 |  | 320 |  | - |  | - |  | 1,099 |  | 1,099 |  | 320
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  | 28,829 |  | 28,829 |  | 4,571 |  | - |  | - |  | 28,829 |  | 28,829 |  | 4,571
Personal |  | 72,989 |  | 72,989 |  | 19,098 |  | - |  | - |  | 72,989 |  | 72,989 |  | 19,098
Auto |  | 1,161 |  | 1,161 |  | 228 |  | - |  | - |  | 1,161 |  | 1,161 |  | 228
Other |  | 1,256 |  | 1,256 |  | 186 |  | - |  | - |  | 1,256 |  | 1,256 |  | 186
Total Puerto Rico | $ | 781,204 | $ | 852,117 | $ | 115,409 | $ | 233,904 | $ | 354,915 | $ | 1,015,108 | $ | 1,207,032 | $ | 115,409
December 31, 2018
Popular U.S.
| Impaired Loans – With an | Impaired Loans |  |  |  |  |  |
| Allowance | With No Allowance | Impaired Loans - Total
|  |  | Unpaid |  |  |  |  | Unpaid |  |  | Unpaid |  |
| Recorded | principal | Related | Recorded | principal | Recorded | principal | Related
(In thousands) | investment | balance | allowance | investment | balance | investment | balance | allowance
Construction | $ | - | $ | - | $ | - | $ | 12,060 | $ | 18,127 | $ | 12,060 | $ | 18,127 | $ | -
Mortgage |  | 7,237 |  | 8,899 |  | 2,451 |  | 2,183 |  | 3,127 |  | 9,420 |  | 12,026 |  | 2,451
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
HELOCs |  | 6,236 |  | 6,285 |  | 1,558 |  | 1,498 |  | 1,572 |  | 7,734 |  | 7,857 |  | 1,558
Personal |  | 631 |  | 631 |  | 252 |  | 142 |  | 143 |  | 773 |  | 774 |  | 252
Total Popular U.S. | $ | 14,104 | $ | 15,815 | $ | 4,261 | $ | 15,883 | $ | 22,969 | $ | 29,987 | $ | 38,784 | $ | 4,261
December 31, 2018
Popular, Inc.
| Impaired Loans – With an | Impaired Loans |  |  |  |  |  |
| Allowance | With No Allowance | Impaired Loans - Total
|  |  | Unpaid |  |  |  |  | Unpaid |  |  | Unpaid |  |
| Recorded | principal | Related | Recorded | principal | Recorded | principal | Related
(In thousands) | investment | balance | allowance | investment | balance | investment | balance | allowance
Commercial multi-family | $ | 932 | $ | 932 | $ | 4 | $ | - | $ | - | $ | 932 | $ | 932 | $ | 4
Commercial real estate non-owner occupied |  | 85,583 |  | 86,282 |  | 27,494 |  | 96,005 |  | 138,378 |  | 181,588 |  | 224,660 |  | 27,494
Commercial real estate owner occupied |  | 113,592 |  | 132,677 |  | 7,857 |  | 26,474 |  | 60,485 |  | 140,066 |  | 193,162 |  | 7,857
Commercial and industrial |  | 65,208 |  | 67,094 |  | 16,835 |  | 10,724 |  | 20,968 |  | 75,932 |  | 88,062 |  | 16,835
Construction |  | 1,788 |  | 1,788 |  | 56 |  | 12,060 |  | 18,127 |  | 13,848 |  | 19,915 |  | 56
Mortgage |  | 416,004 |  | 466,909 |  | 41,211 |  | 102,884 |  | 138,211 |  | 518,888 |  | 605,120 |  | 41,211
Leasing |  | 1,099 |  | 1,099 |  | 320 |  | - |  | - |  | 1,099 |  | 1,099 |  | 320
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  | 28,829 |  | 28,829 |  | 4,571 |  | - |  | - |  | 28,829 |  | 28,829 |  | 4,571
HELOCs |  | 6,236 |  | 6,285 |  | 1,558 |  | 1,498 |  | 1,572 |  | 7,734 |  | 7,857 |  | 1,558
Personal |  | 73,620 |  | 73,620 |  | 19,350 |  | 142 |  | 143 |  | 73,762 |  | 73,763 |  | 19,350
Auto |  | 1,161 |  | 1,161 |  | 228 |  | - |  | - |  | 1,161 |  | 1,161 |  | 228
Other |  | 1,256 |  | 1,256 |  | 186 |  | - |  | - |  | 1,256 |  | 1,256 |  | 186
Total Popular, Inc. | $ | 795,308 | $ | 867,932 | $ | 119,670 | $ | 249,787 | $ | 377,884 | $ | 1,045,095 | $ | 1,245,816 | $ | 119,670
The following tables present the average recorded investment and interest income recognized on impaired loans for the years ended December 31, 2019 and 2018.
For the year ended December 31, 2019
| Puerto Rico |  | Popular U.S. |  | Popular, Inc.
| Average |  | Interest |  | Average |  | Interest |  | Average |  | Interest
| recorded |  | income |  | recorded |  | income |  | recorded |  | income
(In thousands) | investment |  | recognized |  | investment |  | recognized |  | investment |  | recognized
Commercial multi-family | $ | 1,470 |  | $ | 50 |  | $ | 1,343 |  | $ | - |  | $ | 2,813 |  | $ | 50
Commercial real estate non-owner occupied |  | 183,233 |  |  | 5,742 |  |  | - |  |  | - |  |  | 183,233 |  |  | 5,742
Commercial real estate owner occupied |  | 137,710 |  |  | 6,528 |  |  | 626 |  |  | - |  |  | 138,336 |  |  | 6,528
Commercial and industrial |  | 71,828 |  |  | 4,097 |  |  | - |  |  | - |  |  | 71,828 |  |  | 4,097
Construction |  | 1,151 |  |  | 25 |  |  | 9,248 |  |  | - |  |  | 10,399 |  |  | 25
Mortgage |  | 518,487 |  |  | 16,810 |  |  | 9,416 |  |  | 153 |  |  | 527,903 |  |  | 16,963
Leasing |  | 823 |  |  | - |  |  | - |  |  | - |  |  | 823 |  |  | -
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  | 26,775 |  |  | - |  |  | - |  |  | - |  |  | 26,775 |  |  | -
HELOCs |  | - |  |  | - |  |  | 8,988 |  |  | - |  |  | 8,988 |  |  | -
Personal |  | 69,664 |  |  | 282 |  |  | 380 |  |  | - |  |  | 70,044 |  |  | 282
Auto |  | 823 |  |  | - |  |  | - |  |  | - |  |  | 823 |  |  | -
Other |  | 1,044 |  |  | - |  |  | - |  |  | - |  |  | 1,044 |  |  | -
Total Popular, Inc. | $ | 1,013,008 |  | $ | 33,534 |  | $ | 30,001 |  | $ | 153 |  | $ | 1,043,009 |  | $ | 33,687
For the year ended December 31, 2018
| Puerto Rico |  | Popular U.S. |  | Popular, Inc.
| Average |  | Interest |  | Average |  | Interest |  | Average |  | Interest
| recorded |  | income |  | recorded |  | income |  | recorded |  | income
(In thousands) | investment |  | recognized |  | investment |  | recognized |  | investment |  | recognized
Commercial multi-family | $ | 693 |  | $ | 50 |  | $ | - |  | $ | - |  | $ | 693 |  | $ | 50
Commercial real estate non-owner occupied |  | 138,832 |  |  | 5,742 |  |  | - |  |  | - |  |  | 138,832 |  |  | 5,742
Commercial real estate owner occupied |  | 148,967 |  |  | 6,528 |  |  | - |  |  | - |  |  | 148,967 |  |  | 6,528
Commercial and industrial |  | 69,406 |  |  | 4,097 |  |  | - |  |  | - |  |  | 69,406 |  |  | 4,097
Construction |  | 2,094 |  |  | 25 |  |  | 9,565 |  |  | - |  |  | 11,659 |  |  | 25
Mortgage |  | 509,038 |  |  | 17,663 |  |  | 9,258 |  |  | 165 |  |  | 518,296 |  |  | 17,828
Leasing |  | 1,195 |  |  | - |  |  | - |  |  | - |  |  | 1,195 |  |  | -
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Credit cards |  | 31,953 |  |  | - |  |  | - |  |  | - |  |  | 31,953 |  |  | -
HELOCs |  | - |  |  | - |  |  | 5,904 |  |  | - |  |  | 5,904 |  |  | -
Personal |  | 68,237 |  |  | 415 |  |  | 770 |  |  | - |  |  | 69,007 |  |  | 415
Auto |  | 1,413 |  |  | - |  |  | - |  |  | - |  |  | 1,413 |  |  | -
Other |  | 1,248 |  |  | - |  |  | - |  |  | - |  |  | 1,248 |  |  | -
Total Popular, Inc. | $ | 973,076 |  | $ | 34,520 |  | $ | 25,497 |  | $ | 165 |  | $ | 998,573 |  | $ | 34,685
Modifications A modification of a loan constitutes a troubled debt restructuring when a borrower is experiencing financial difficulty and the modification constitutes a concession. For a summary of the accounting policy related to troubled debt restructurings (“TDRs”), refer to the Summary of Significant Accounting Policies included in Note 2 to these Consolidated Financial Statements. TDRs amounted to $ 1.6 billion at December 31, 2019 (December 31, 2018 - $ 1.5 billion). The amount of outstanding commitments to lend additional funds to debtors owing receivables whose terms have been modified in TDRs amounted to $ 14 million related to the commercial loan portfolio at December 31, 2019 (December 31, 2018 - $ 16 million). At December 31, 2019, the mortgage loan TDRs include $ 625 million guaranteed by U.S. sponsored entities at BPPR, compared to $ 543 million at December 31, 2018. The following table presents the non-covered and covered loans classified as TDRs according to their accruing status and the related allowance at December 31, 2019 and 2018.
| December 31, 2019 |  |  | December 31, 2018
(In thousands) |  | Accruing |  | Non-Accruing |  | Total |  | Related Allowance |  |  |  | Accruing |  | Non-Accruing |  | Total |  | Related Allowance
Loans held-in-portfolio: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial | $ | 237,861 | $ | 111,587 | $ | 349,448 | $ | 16,443 |  |  | $ | 229,758 | $ | 130,921 | $ | 360,679 | $ | 46,889
Construction |  | - |  | 119 |  | 119 |  | 6 |  |  |  | - |  | 1,788 |  | 1,788 |  | 56
Mortgage |  | 1,013,561 |  | 126,036 |  | 1,139,597 |  | 42,012 |  |  |  | 906,712 |  | 135,758 |  | 1,042,470 |  | 41,211
Leases |  | 264 |  | 243 |  | 507 |  | 61 |  |  |  | 668 |  | 440 |  | 1,108 |  | 320
Consumer |  | 82,205 |  | 15,808 |  | 98,013 |  | 21,404 |  |  |  | 94,193 |  | 15,651 |  | 109,844 |  | 24,523
Loans held-in-portfolio | $ | 1,333,891 | $ | 253,793 | $ | 1,587,684 | $ | 79,926 |  |  | $ | 1,231,331 | $ | 284,558 | $ | 1,515,889 | $ | 112,999
The following tables present the loan count by type of modification for those loans modified in a TDR during the years ended December 31, 2019 and 2018. Loans modified as TDRs for the U.S. operations are considered insignificant to the Corporation.
For the year ended December 31, 2019
| Reduction in interest rate |  | Extension of maturity date |  | Combination of reduction in interest rate and extension of maturity date |  | Other
Commercial multi-family | - |  | 3 |  | - |  | -
Commercial real estate non-owner occupied | - |  | 13 |  | - |  | -
Commercial real estate owner occupied | 1 |  | 29 |  | - |  | -
Commercial and industrial | 2 |  | 67 |  | - |  | -
Mortgage | 37 |  | 130 |  | 672 |  | 6
Leasing | - |  | 1 |  | 2 |  | -
Consumer: |  |  |  |  |  |  |
Credit cards | 515 |  | - |  | 2 |  | 189
HELOCs | - |  | 16 |  | 12 |  | -
Personal | 668 |  | 4 |  | - |  | 3
Auto | - |  | 6 |  | 2 |  | -
Other | 31 |  | - |  | - |  | -
Total | 1,254 |  | 269 |  | 690 |  | 198
For the year ended December 31, 2018
| Reduction in interest rate |  | Extension of maturity date |  | Combination of reduction in interest rate and extension of maturity date |  | Other
Commercial multi-family | - |  | 2 |  | - |  | -
Commercial real estate non-owner occupied | 3 |  | 17 |  | - |  | -
Commercial real estate owner occupied | 4 |  | 64 |  | - |  | -
Commercial and industrial | 6 |  | 87 |  | - |  | -
Construction | 1 |  | - |  | - |  | -
Mortgage | 85 |  | 49 |  | 359 |  | 57
Leasing | - |  | - |  | 4 |  | -
Consumer: |  |  |  |  |  |  |
Credit cards | 579 |  | - |  | 4 |  | 432
HELOCs | - |  | 27 |  | 11 |  | 1
Personal | 1,356 |  | 6 |  | - |  | 2
Auto | - |  | 7 |  | 3 |  | -
Other | 25 |  | - |  | 2 |  | -
Total | 2,059 |  | 259 |  | 383 |  | 492
The following tables present, by class, quantitative information related to loans modified as TDRs during the years ended December 31, 2019 and 2018.
Popular, Inc.
For the year ended December 31, 2019
(Dollars in thousands) | Loan count | Pre-modification outstanding recorded investment | Post-modification outstanding recorded investment | Increase (decrease) in the allowance for loan losses as a result of modification
Commercial multi-family | 3 | $ | 346 | $ | 295 | $ | (40)
Commercial real estate non-owner occupied | 13 |  | 58,142 |  | 58,116 |  | 2,811
Commercial real estate owner occupied | 30 |  | 7,533 |  | 7,249 |  | 81
Commercial and industrial | 69 |  | 14,991 |  | 15,435 |  | 1,368
Mortgage | 845 |  | 83,833 |  | 77,308 |  | 2,814
Leasing | 3 |  | 264 |  | 266 |  | 7
Consumer: |  |  |  |  |  |  |
Credit cards | 706 |  | 5,702 |  | 5,867 |  | 554
HELOCs | 28 |  | 2,725 |  | 2,423 |  | 364
Personal | 675 |  | 10,831 |  | 10,835 |  | 3,023
Auto | 8 |  | 121 |  | 128 |  | 21
Other | 31 |  | 206 |  | 206 |  | 30
Total | 2,411 | $ | 184,694 | $ | 178,128 | $ | 11,033
Popular, Inc.
For the year ended December 31, 2018
(Dollars in thousands) | Loan count | Pre-modification outstanding recorded investment | Post-modification outstanding recorded investment | Increase (decrease) in the allowance for loan losses as a result of modification
Commercial multi-family | 2 | $ | 1,377 | $ | 1,375 | $ | 106
Commercial real estate non-owner occupied | 20 |  | 109,081 |  | 79,695 |  | 6,230
Commercial real estate owner occupied | 68 |  | 31,233 |  | 29,962 |  | 1,170
Commercial and industrial | 93 |  | 52,653 |  | 51,855 |  | 13,981
Construction | 1 |  | 4,210 |  | 4,293 |  | 474
Mortgage | 550 |  | 67,518 |  | 59,919 |  | 2,696
Leasing | 4 |  | 98 |  | 96 |  | 30
Consumer: |  |  |  |  |  |  |
Credit cards | 1,015 |  | 10,065 |  | 10,671 |  | 1,331
HELOCs | 39 |  | 3,961 |  | 3,891 |  | 935
Personal | 1,364 |  | 21,976 |  | 21,979 |  | 6,320
Auto | 10 |  | 173 |  | 152 |  | 26
Other | 27 |  | 601 |  | 599 |  | 99
Total | 3,193 | $ | 302,946 | $ | 264,487 | $ | 33,398
During the year ended December 31, 2019, four loans with an aggregate unpaid principal balance of $ 9.1 million were restructured into multiple notes (“Note A / B split”). No charge-offs were recorded as part of those loan restructurings. The following tables present, by class, TDRs that were subject to payment default and that had been modified as a TDR during the twelve months preceding the default date. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date. Loans modified as a TDR that were fully paid down, charged-off or foreclosed upon by period end are not reported.
Defaulted during the year ended December 31, 2019
(Dollars in thousands) | Loan count | Recorded investment as of first default date
Commercial real estate non-owner occupied | 1 | $ | 47
Commercial real estate owner occupied | 3 |  | 495
Commercial and industrial | 9 |  | 7,281
Mortgage | 63 |  | 4,424
Leasing | 1 |  | 22
Consumer: |  |  |
Credit cards | 302 |  | 2,808
HELOCs | 1 |  | 135
Personal | 197 |  | 5,640
Auto | 2 |  | 24
Other | 3 |  | 8
Total | 582 | $ | 20,884
Defaulted during the year ended December 31, 2018
(Dollars in thousands) | Loan count | Recorded investment as of first default date
Commercial real estate non-owner occupied | 2 | $ | 11,245
Commercial real estate owner occupied | 5 |  | 480
Commercial and industrial | 8 |  | 7,208
Mortgage | 161 |  | 12,362
Consumer: |  |  |
Credit cards | 236 |  | 2,098
HELOCs | 2 |  | 205
Personal | 107 |  | 2,300
Auto | 5 |  | 115
Other | 1 |  | 7
Total | 527 | $ | 36,020
Commercial, consumer and mortgage loans modified in a TDR are closely monitored for delinquency as an early indicator of possible future default. If loans modified in a TDR subsequently default, the Corporation evaluates the loan for possible further impairment. The allowance for loan losses may be increased or partial charge-offs may be taken to further write-down the carrying value of the loan. Credit Quality The Corporation has defined a risk rating system to assign a rating to all credit exposures, particularly for the commercial and construction loan portfolios. Risk ratings in the aggregate provide the Corporation’s management the asset quality profile for the loan portfolio. The risk rating system provides for the assignment of ratings at the obligor level based on the financial condition of the borrower. The Corporation’s consumer and mortgage loans are not subject to the risk rating system. Consumer and mortgage loans are classified substandard or loss based on their delinquency status. All other consumer and mortgage loans that are not classified as substandard or loss would be considered “unrated”. The Corporation’s obligor risk rating scales range from rating 1 (Excellent) to rating 14 (Loss). The obligor risk rating reflects the risk of payment default of a borrower in the ordinary course of business. Pass Credit Classifications: Pass (Scales 1 through 8) – Loans classified as pass have a well defined primary source of repayment, with no apparent risk, strong financial position, minimal operating risk, profitability, liquidity and strong capitalization. Watch (Scale 9) – Loans classified as watch have acceptable business credit, but borrower’s operations, cash flow or financial condition evidence more than average risk, requires above average levels of supervision and attention from Loan Officers. Special Mention (Scale 10) - Loans classified as special mention have potential weaknesses that deserve management’s close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the loan or of the Corporation’s credit position at some future date. Adversely Classified Classifications: Substandard (Scales 11 and 12) - Loans classified as substandard are deemed to be inadequately protected by the current net worth and payment capacity of the obligor or of the collateral pledged, if any. Loans classified as such have well-defined weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected. Doubtful (Scale 13) - Loans classified as doubtful have all the weaknesses inherent in those classified as substandard, with the additional characteristic that the weaknesses make the collection or liquidation in full, on the basis of currently existing facts, conditions, and values, highly questionable and improbable. Loss (Scale 14) - Uncollectible and of such little value that continuance as a bankable asset is not warranted. This classification does not mean that the asset has absolutely no recovery or salvage value, but rather it is not practical or desirable to defer writing off this asset even though partial recovery may be effected in the future. Risk ratings scales 10 through 14 conform to regulatory ratings. The assignment of the obligor risk rating is based on relevant information about the ability of borrowers to service their debts such as current financial information, historical payment experience, credit documentation, public information, and current economic trends, among other factors. The Corporation periodically reviews its loans classification to evaluate if they are properly classified, and to determine impairment, if any. The frequency of these reviews will depend on the amount of the aggregate outstanding debt, and the risk rating classification of the obligor. In addition, during the renewal and annual review process of applicable credit facilities, the Corporation evaluates the corresponding loan grades. The Corporation has a Commercial Loan Review department within the Corporate Risk Reviews Division that reports directly to the Corporation’s Risk Management Committee and administratively to the Chief Risk Officer, which performs annual comprehensive credit process reviews of all lending groups in BPPR. This group evaluates the credit risk profile of each originating unit along with each unit’s credit administration effectiveness, including the assessment of the risk rating representative of the current credit quality of the loans, and the evaluation of collateral documentation. The monitoring performed by this group contributes to assess compliance with credit policies and underwriting standards, determine the current level of credit risk, evaluate the effectiveness of the credit management process and identify control deficiencies that may arise in the credit-granting process. Based on its findings, Commercial Loan Review recommends corrective actions, if necessary, that help in maintaining a sound credit process. The Loan Review Group reports the results of the credit process reviews to the Risk Management Committee of the Corporation’s Board of Directors. The following tables present the outstanding balance, net of unearned income, of non-covered loans held-in-portfolio based on the Corporation’s assignment of obligor risk ratings as defined at December 31, 2019 and 2018.
December 31, 2019
|  |  |  | Special |  |  |  |  |  |  |  |  | Pass/ |  |
(In thousands) | Watch | Mention | Substandard | Doubtful | Loss | Sub-total | Unrated | Total
Puerto Rico |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial multi-family | $ | 1,341 | $ | 3,870 | $ | 1,793 | $ | - | $ | - | $ | 7,004 | $ | 140,845 | $ | 147,849
Commercial real estate non-owner occupied |  | 492,357 |  | 166,810 |  | 239,448 |  | 3,290 |  | - |  | 901,905 |  | 1,206,313 |  | 2,108,218
Commercial real estate owner occupied |  | 192,895 |  | 184,678 |  | 183,377 |  | 1,629 |  | - |  | 562,579 |  | 1,023,750 |  | 1,586,329
Commercial and industrial |  | 592,861 |  | 170,183 |  | 130,872 |  | 148 |  | 16 |  | 894,080 |  | 2,524,654 |  | 3,418,734
| Total Commercial |  | 1,279,454 |  | 525,541 |  | 555,490 |  | 5,067 |  | 16 |  | 2,365,568 |  | 4,895,562 |  | 7,261,130
Construction |  | 340 |  | 649 |  | 20,771 |  | - |  | - |  | 21,760 |  | 115,710 |  | 137,470
Mortgage |  | 2,187 |  | 2,218 |  | 127,621 |  | - |  | - |  | 132,026 |  | 6,034,722 |  | 6,166,748
Leasing |  | - |  | - |  | 3,590 |  | - |  | 68 |  | 3,658 |  | 1,055,849 |  | 1,059,507
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit cards |  | - |  | - |  | 19,461 |  | - |  | - |  | 19,461 |  | 1,104,339 |  | 1,123,800
| HELOCs |  | - |  | - |  | - |  | - |  | - |  | - |  | 5,038 |  | 5,038
| Personal |  | 77 |  | - |  | 19,558 |  | - |  | - |  | 19,635 |  | 1,348,515 |  | 1,368,150
| Auto |  | - |  | - |  | 30,775 |  | - |  | 372 |  | 31,147 |  | 2,886,375 |  | 2,917,522
| Other |  | 459 |  | 11 |  | 15,020 |  | - |  | 53 |  | 15,543 |  | 125,324 |  | 140,867
| Total Consumer |  | 536 |  | 11 |  | 84,814 |  | - |  | 425 |  | 85,786 |  | 5,469,591 |  | 5,555,377
Total Puerto Rico | $ | 1,282,517 | $ | 528,419 | $ | 792,286 | $ | 5,067 | $ | 509 | $ | 2,608,798 | $ | 17,571,434 | $ | 20,180,232
Popular U.S. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial multi-family | $ | 48,359 | $ | 13,827 | $ | 8,433 | $ | - | $ | - | $ | 70,619 | $ | 1,576,691 | $ | 1,647,310
Commercial real estate non-owner occupied |  | 80,608 |  | 24,383 |  | 100,658 |  | - |  | - |  | 205,649 |  | 1,664,647 |  | 1,870,296
Commercial real estate owner occupied |  | 27,298 |  | 5,709 |  | 13,826 |  | - |  | - |  | 46,833 |  | 292,302 |  | 339,135
Commercial and industrial |  | 25,679 |  | 1,460 |  | 20,386 |  | - |  | - |  | 47,525 |  | 1,147,355 |  | 1,194,880
| Total Commercial |  | 181,944 |  | 45,379 |  | 143,303 |  | - |  | - |  | 370,626 |  | 4,680,995 |  | 5,051,621
Construction |  | 46,644 |  | 17,291 |  | 44,798 |  | - |  | - |  | 108,733 |  | 584,889 |  | 693,622
Mortgage |  | - |  | - |  | 11,091 |  | - |  | - |  | 11,091 |  | 1,005,693 |  | 1,016,784
Legacy |  | 388 |  | 202 |  | 1,528 |  | - |  | - |  | 2,118 |  | 19,987 |  | 22,105
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit cards |  | - |  | - |  | - |  | - |  | - |  | - |  | 36 |  | 36
| HELOCs |  | - |  | - |  | 2,024 |  | - |  | 7,930 |  | 9,954 |  | 107,389 |  | 117,343
| Personal |  | - |  | - |  | 1,664 |  | - |  | 403 |  | 2,067 |  | 322,373 |  | 324,440
| Other |  | - |  | - |  | - |  | - |  | - |  | - |  | 690 |  | 690
| Total Consumer |  | - |  | - |  | 3,688 |  | - |  | 8,333 |  | 12,021 |  | 430,488 |  | 442,509
Total Popular U.S. | $ | 228,976 | $ | 62,872 | $ | 204,408 | $ | - | $ | 8,333 | $ | 504,589 | $ | 6,722,052 | $ | 7,226,641
Popular, Inc. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial multi-family | $ | 49,700 | $ | 17,697 | $ | 10,226 | $ | - | $ | - | $ | 77,623 | $ | 1,717,536 | $ | 1,795,159
Commercial real estate non-owner occupied |  | 572,965 |  | 191,193 |  | 340,106 |  | 3,290 |  | - |  | 1,107,554 |  | 2,870,960 |  | 3,978,514
Commercial real estate owner occupied |  | 220,193 |  | 190,387 |  | 197,203 |  | 1,629 |  | - |  | 609,412 |  | 1,316,052 |  | 1,925,464
Commercial and industrial |  | 618,540 |  | 171,643 |  | 151,258 |  | 148 |  | 16 |  | 941,605 |  | 3,672,009 |  | 4,613,614
| Total Commercial |  | 1,461,398 |  | 570,920 |  | 698,793 |  | 5,067 |  | 16 |  | 2,736,194 |  | 9,576,557 |  | 12,312,751
Construction |  | 46,984 |  | 17,940 |  | 65,569 |  | - |  | - |  | 130,493 |  | 700,599 |  | 831,092
Mortgage |  | 2,187 |  | 2,218 |  | 138,712 |  | - |  | - |  | 143,117 |  | 7,040,415 |  | 7,183,532
Legacy |  | 388 |  | 202 |  | 1,528 |  | - |  | - |  | 2,118 |  | 19,987 |  | 22,105
Leasing |  | - |  | - |  | 3,590 |  | - |  | 68 |  | 3,658 |  | 1,055,849 |  | 1,059,507
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit cards |  | - |  | - |  | 19,461 |  | - |  | - |  | 19,461 |  | 1,104,375 |  | 1,123,836
| HELOCs |  | - |  | - |  | 2,024 |  | - |  | 7,930 |  | 9,954 |  | 112,427 |  | 122,381
| Personal |  | 77 |  | - |  | 21,222 |  | - |  | 403 |  | 21,702 |  | 1,670,888 |  | 1,692,590
| Auto |  | - |  | - |  | 30,775 |  | - |  | 372 |  | 31,147 |  | 2,886,375 |  | 2,917,522
| Other |  | 459 |  | 11 |  | 15,020 |  | - |  | 53 |  | 15,543 |  | 126,014 |  | 141,557
| Total Consumer |  | 536 |  | 11 |  | 88,502 |  | - |  | 8,758 |  | 97,807 |  | 5,900,079 |  | 5,997,886
Total Popular, Inc. | $ | 1,511,493 | $ | 591,291 | $ | 996,694 | $ | 5,067 | $ | 8,842 | $ | 3,113,387 | $ | 24,293,486 | $ | 27,406,873
The following table presents the weighted average obligor risk rating at December 31, 2019 for those classifications that consider a range of rating scales.
Weighted average obligor risk rating | (Scales 11 and 12) |  |  |  | (Scales 1 through 8)
Puerto Rico: |  |  |  |  | Substandard |  |  |  |  |  |  | Pass |  |
Commercial multi-family |  |  |  |  |  | 11.82 |  |  |  |  |  |  |  | 6.02 |  |
Commercial real estate non-owner occupied |  |  |  |  |  | 11.17 |  |  |  |  |  |  |  | 6.77 |  |
Commercial real estate owner occupied |  |  |  |  |  | 11.36 |  |  |  |  |  |  |  | 7.30 |  |
Commercial and industrial |  |  |  |  |  | 11.26 |  |  |  |  |  |  |  | 7.20 |  |
| Total Commercial |  |  |  |  |  | 11.25 |  |  |  |  |  |  |  | 7.10 |  |
Construction |  |  |  |  |  | 11.01 |  |  |  |  |  |  |  | 7.85 |  |
Popular U.S. : |  |  |  |  | Substandard |  |  |  |  |  |  | Pass |  |
Commercial multi-family |  |  |  |  |  | 11.25 |  |  |  |  |  |  |  | 7.37 |  |
Commercial real estate non-owner occupied |  |  |  |  |  | 11.00 |  |  |  |  |  |  |  | 6.94 |  |
Commercial real estate owner occupied |  |  |  |  |  | 11.02 |  |  |  |  |  |  |  | 7.48 |  |
Commercial and industrial |  |  |  |  |  | 11.01 |  |  |  |  |  |  |  | 6.63 |  |
| Total Commercial |  |  |  |  |  | 11.02 |  |  |  |  |  |  |  | 7.04 |  |
Construction |  |  |  |  |  | 11.00 |  |  |  |  |  |  |  | 7.74 |  |
Legacy |  |  |  |  |  | 11.25 |  |  |  |  |  |  |  | 7.95 |  |
December 31, 2018
|  |  |  | Special |  |  |  |  |  |  |  |  | Pass/ |  |
(In thousands) | Watch | Mention | Substandard | Doubtful | Loss | Sub-total | Unrated | Total
Puerto Rico |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial multi-family | $ | 1,634 | $ | 4,548 | $ | 3,590 | $ | - | $ | - | $ | 9,772 | $ | 135,856 | $ | 145,628
Commercial real estate non-owner occupied |  | 470,506 |  | 233,173 |  | 342,962 |  | - |  | - |  | 1,046,641 |  | 1,275,960 |  | 2,322,601
Commercial real estate owner occupied |  | 262,476 |  | 174,510 |  | 291,468 |  | 2,078 |  | - |  | 730,532 |  | 991,721 |  | 1,722,253
Commercial and industrial |  | 655,092 |  | 130,641 |  | 156,515 |  | 177 |  | 73 |  | 942,498 |  | 2,239,663 |  | 3,182,161
| Total Commercial |  | 1,389,708 |  | 542,872 |  | 794,535 |  | 2,255 |  | 73 |  | 2,729,443 |  | 4,643,200 |  | 7,372,643
Construction |  | 147 |  | 634 |  | 1,788 |  | - |  | - |  | 2,569 |  | 83,386 |  | 85,955
Mortgage |  | 3,057 |  | 2,182 |  | 154,506 |  | - |  | - |  | 159,745 |  | 6,273,578 |  | 6,433,323
Leasing |  | - |  | - |  | 3,301 |  | - |  | 12 |  | 3,313 |  | 931,460 |  | 934,773
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit cards |  | - |  | - |  | 16,035 |  | - |  | - |  | 16,035 |  | 1,031,238 |  | 1,047,273
| HELOCs |  | - |  | - |  | 165 |  | - |  | - |  | 165 |  | 5,186 |  | 5,351
| Personal |  | 849 |  | 19 |  | 18,827 |  | - |  | - |  | 19,695 |  | 1,230,930 |  | 1,250,625
| Auto |  | - |  | - |  | 24,093 |  | - |  | 84 |  | 24,177 |  | 2,584,608 |  | 2,608,785
| Other |  | - |  | - |  | 14,743 |  | - |  | 215 |  | 14,958 |  | 129,786 |  | 144,744
| Total Consumer |  | 849 |  | 19 |  | 73,863 |  | - |  | 299 |  | 75,030 |  | 4,981,748 |  | 5,056,778
Total Puerto Rico | $ | 1,393,761 | $ | 545,707 | $ | 1,027,993 | $ | 2,255 | $ | 384 | $ | 2,970,100 | $ | 16,913,372 | $ | 19,883,472
Popular U.S. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial multi-family | $ | 85,901 | $ | 7,123 | $ | 6,979 | $ | - | $ | - | $ | 100,003 | $ | 1,301,537 | $ | 1,401,540
Commercial real estate non-owner occupied |  | 152,635 |  | 9,839 |  | 46,555 |  | - |  | - |  | 209,029 |  | 1,672,715 |  | 1,881,744
Commercial real estate owner occupied |  | 49,415 |  | 23,963 |  | 2,394 |  | - |  | - |  | 75,772 |  | 223,167 |  | 298,939
Commercial and industrial |  | 5,825 |  | 1,084 |  | 76,459 |  | - |  | - |  | 83,368 |  | 1,004,785 |  | 1,088,153
| Total Commercial |  | 293,776 |  | 42,009 |  | 132,387 |  | - |  | - |  | 468,172 |  | 4,202,204 |  | 4,670,376
Construction |  | 35,375 |  | 37,741 |  | 58,005 |  | - |  | - |  | 131,121 |  | 562,373 |  | 693,494
Mortgage |  | - |  | - |  | 11,032 |  | - |  | - |  | 11,032 |  | 790,903 |  | 801,935
Legacy |  | 534 |  | 224 |  | 2,409 |  | - |  | - |  | 3,167 |  | 22,782 |  | 25,949
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit cards |  | - |  | - |  | - |  | - |  | - |  | - |  | 38 |  | 38
| HELOCs |  | - |  | - |  | 2,615 |  | - |  | 10,964 |  | 13,579 |  | 129,473 |  | 143,052
| Personal |  | - |  | - |  | 1,910 |  | - |  | 701 |  | 2,611 |  | 286,738 |  | 289,349
| Other |  | - |  | - |  | 4 |  | - |  | - |  | 4 |  | 220 |  | 224
| Total Consumer |  | - |  | - |  | 4,529 |  | - |  | 11,665 |  | 16,194 |  | 416,469 |  | 432,663
Total Popular U.S. | $ | 329,685 | $ | 79,974 | $ | 208,362 | $ | - | $ | 11,665 | $ | 629,686 | $ | 5,994,731 | $ | 6,624,417
Popular, Inc. |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Commercial multi-family | $ | 87,535 | $ | 11,671 | $ | 10,569 | $ | - | $ | - | $ | 109,775 | $ | 1,437,393 | $ | 1,547,168
Commercial real estate non-owner occupied |  | 623,141 |  | 243,012 |  | 389,517 |  | - |  | - |  | 1,255,670 |  | 2,948,675 |  | 4,204,345
Commercial real estate owner occupied |  | 311,891 |  | 198,473 |  | 293,862 |  | 2,078 |  | - |  | 806,304 |  | 1,214,888 |  | 2,021,192
Commercial and industrial |  | 660,917 |  | 131,725 |  | 232,974 |  | 177 |  | 73 |  | 1,025,866 |  | 3,244,448 |  | 4,270,314
| Total Commercial |  | 1,683,484 |  | 584,881 |  | 926,922 |  | 2,255 |  | 73 |  | 3,197,615 |  | 8,845,404 |  | 12,043,019
Construction |  | 35,522 |  | 38,375 |  | 59,793 |  | - |  | - |  | 133,690 |  | 645,759 |  | 779,449
Mortgage |  | 3,057 |  | 2,182 |  | 165,538 |  | - |  | - |  | 170,777 |  | 7,064,481 |  | 7,235,258
Legacy |  | 534 |  | 224 |  | 2,409 |  | - |  | - |  | 3,167 |  | 22,782 |  | 25,949
Leasing |  | - |  | - |  | 3,301 |  | - |  | 12 |  | 3,313 |  | 931,460 |  | 934,773
Consumer: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| Credit cards |  | - |  | - |  | 16,035 |  | - |  | - |  | 16,035 |  | 1,031,276 |  | 1,047,311
| HELOCs |  | - |  | - |  | 2,780 |  | - |  | 10,964 |  | 13,744 |  | 134,659 |  | 148,403
| Personal |  | 849 |  | 19 |  | 20,737 |  | - |  | 701 |  | 22,306 |  | 1,517,668 |  | 1,539,974
| Auto |  | - |  | - |  | 24,093 |  | - |  | 84 |  | 24,177 |  | 2,584,608 |  | 2,608,785
| Other |  | - |  | - |  | 14,747 |  | - |  | 215 |  | 14,962 |  | 130,006 |  | 144,968
| Total Consumer |  | 849 |  | 19 |  | 78,392 |  | - |  | 11,964 |  | 91,224 |  | 5,398,217 |  | 5,489,441
Total Popular, Inc. | $ | 1,723,446 | $ | 625,681 | $ | 1,236,355 | $ | 2,255 | $ | 12,049 | $ | 3,599,786 | $ | 22,908,103 | $ | 26,507,889
The following table presents the weighted average obligor risk rating at December 31, 2018 for those classifications that consider a range of rating scales.
Weighted average obligor risk rating | (Scales 11 and 12) |  |  |  | (Scales 1 through 8)
Puerto Rico: |  |  |  |  | Substandard |  |  |  |  |  |  | Pass |  |
Commercial multi-family |  |  |  |  |  | 11.20 |  |  |  |  |  |  |  | 6.02 |  |
Commercial real estate non-owner occupied |  |  |  |  |  | 11.11 |  |  |  |  |  |  |  | 6.93 |  |
Commercial real estate owner occupied |  |  |  |  |  | 11.29 |  |  |  |  |  |  |  | 7.25 |  |
Commercial and industrial |  |  |  |  |  | 11.33 |  |  |  |  |  |  |  | 7.15 |  |
| Total Commercial |  |  |  |  |  | 11.22 |  |  |  |  |  |  |  | 7.09 |  |
Construction |  |  |  |  |  | 12.00 |  |  |  |  |  |  |  | 7.64 |  |
Popular U.S.: |  |  |  |  | Substandard |  |  |  |  |  |  | Pass |  |
Commercial multi-family |  |  |  |  |  | 11.00 |  |  |  |  |  |  |  | 7.39 |  |
Commercial real estate non-owner occupied |  |  |  |  |  | 11.01 |  |  |  |  |  |  |  | 6.82 |  |
Commercial real estate owner occupied |  |  |  |  |  | 11.16 |  |  |  |  |  |  |  | 7.55 |  |
Commercial and industrial |  |  |  |  |  | 11.96 |  |  |  |  |  |  |  | 7.26 |  |
| Total Commercial |  |  |  |  |  | 11.56 |  |  |  |  |  |  |  | 7.14 |  |
Construction |  |  |  |  |  | 11.21 |  |  |  |  |  |  |  | 7.85 |  |
Legacy |  |  |  |  |  | 11.17 |  |  |  |  |  |  |  | 7.94 |  |

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