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Popular, Inc. (Holding company only) financial information

12 Months Ended

Dec. 31, 2019

Disclosure Text Block

Popular, Inc (Holding Company Only) Financial Information

Note 41 - Popular, Inc. (holding company only) financial information

The following condensed financial information presents the financial position of Popular, Inc. Holding Company only at December 31, 2019 and 2018, and the results of its operations and cash flows for the years ended December 31, 2019, 2018 and 2017.

Condensed Statements of Condition
			December 31,
(In thousands)			2019		2018
ASSETS
Cash and due from banks (includes $56,008 due from bank subsidiary (2018 - $68,022))		$	55,956	$	68,022
Money market investments			221,598		176,256
Debt securities held-to-maturity, at amortized cost (includes $8,726 in common securities from statutory trusts (2018 - $8,726))			8,726		8,726
Equity securities, at lower of cost or realizable value^[1]			10,744		6,693
Investment in BPPR and subsidiaries, at equity			4,233,046		3,813,640
Investment in Popular North America and subsidiaries, at equity			1,749,518		1,648,577
Investment in other non-bank subsidiaries, at equity			260,501		241,902
Other loans			32,027		32,678
	Less - Allowance for loan losses		410		155
Premises and equipment			3,893		3,394
Investment in equity method investees			75,739		62,781
Other assets (includes $4,353 due from subsidiaries and affiliate (2018 - $1,355))			25,087		20,281
Total assets		$	6,676,425	$	6,082,795

LIABILITIES AND STOCKHOLDERS' EQUITY
Notes payable		$	586,119	$	584,851
Other liabilities (includes $2,109 due to subsidiaries and affiliate (2018 - $3,110))			73,596		62,799
Stockholders’ equity			6,016,710		5,435,145
Total liabilities and stockholders’ equity		$	6,676,425	$	6,082,795
[1] Refer to Note 20 to the consolidated financial statements for information on the statutory trusts.

Condensed Statements of Operations
			Years ended December 31,
(In thousands)			2019		2018		2017
Income:
	Dividends from subsidiaries	$	408,000	$	453,200	$	211,500
	Interest income (includes $4,237 due from subsidiaries and affiliates (2018 - $6,121; 2017 - $3,183))		6,669		8,366		4,238
	Earnings from investments in equity method investees		17,279		15,498		11,761
	Other operating income		1		253		86
	Net gain (loss), including impairment, on equity securities		988		(777)		-
	Net gain on trading account debt securities		-		-		266
Total income			432,937		476,540		227,851
Expenses:
	Interest expense		38,528		51,218		52,470
	Provision (reversal) for loan losses		256		(251)		403
	Loss on early extinguishment of debt		-		12,522		-
	Operating expenses (includes expenses for services provided by subsidiaries and affiliate of $14,400 (2018 - $10,511 ; 2017 - $8,225)), net of reimbursement by subsidiaries for services provided by parent of $106,725 (2018 - $90,807 ; 2017 - $76,720)		80		3,656		(1,773)
Total expenses			38,864		67,145		51,100
Income before equity in undistributed earnings of subsidiaries			394,073		409,395		176,751
Equity in undistributed earnings (losses) of subsidiaries			277,062		208,763		(69,070)
Net income		$	671,135	$	618,158	$	107,681
Comprehensive income, net of tax		$	929,171	$	540,836	$	77,315

Condensed Statements of Cash Flows
				Years ended December 31,
(In thousands)				2019		2018		2017
Cash flows from operating activities:
Net income			$	671,135	$	618,158	$	107,681
Adjustments to reconcile net income to net cash provided by operating activities:
	Equity in (earnings) losses of subsidiaries, net of dividends or distributions			(277,062)		(208,763)		69,070
	Provision (reversal) for loan losses			256		(251)		403
	Amortization of intangibles			96		41		-
	Net accretion of discounts and amortization of premiums and deferred fees			1,240		2,022		2,086
	Share-based compensation			7,927		7,441		-
	Earnings from investments under the equity method, net of dividends or distributions			(14,948)		(14,333)		(7,765)
	Loss on early extinguishment of debt			-		12,522		-
	Net (increase) decrease in:
		Equity securities		(4,051)		(1,583)		(1,346)
		Other assets		1,134		344		8,696
	Net (decrease) increase in:
		Interest payable		-		(10,288)		-
		Other liabilities		2,508		8,059		3,230
Total adjustments				(282,900)		(204,789)		74,374
Net cash provided by operating activities				388,235		413,369		182,055
Cash flows from investing activities:
	Net (increase) decrease in money market investments			(45,000)		70,000		6,000
	Net repayments on other loans			677		536		181
	Capital contribution to subsidiaries			(9,000)		(87,000)		(5,955)
	Return of capital from wholly owned subsidiaries			13,000		13,000		22,400
	Acquisition of loans portfolio			-		-		(31,909)
	Acquisition of trademark			-		-		(5,560)
	Acquisition of premises and equipment			(1,289)		(1,099)		(965)
	Proceeds from sale of:
		Premises and equipment		3		293		23
		Foreclosed assets		-		-		38
Net cash used in investing activities				(41,609)		(4,270)		(15,747)
Cash flows from financing activities:
	Payments of notes payable			-		(448,518)		-
	Payments of debt extinguishment			-		(12,522)		-
	Proceeds from issuance of notes payable			-		293,819		-
	Proceeds from issuance of common stock			13,451		11,653		7,016
	Dividends paid			(115,810)		(105,441)		(95,910)
	Net payments for repurchase of common stock			(250,571)		(125,731)		(75,668)
	Payments related to tax withholding for share-based compensation			(5,420)		(2,201)		(1,756)
Net cash used in financing activities				(358,350)		(388,941)		(166,318)
Net (decrease) increase in cash and due from banks, and restricted cash				(11,724)		20,158		(10)
Cash and due from banks, and restricted cash at beginning of period				68,278		48,120		48,130
Cash and due from banks, and restricted cash at end of period			$	56,554	$	68,278	$	48,120

Popular, Inc. (parent company only) received dividend distributions from its direct equity method investees amounting to $2.3 million for the year ended December 31, 2019 (2018 - $1.2 million).

Notes payable include junior subordinated debentures issued by the Corporation that are associated to capital securities issued by the Popular Capital Trust I and Popular Capital Trust II and medium-term notes. Refer to Note 20 for a description of significant provisions related to these junior subordinated debentures. The following table presents the aggregate amounts by contractual maturities of notes payable at December 31, 2019:

Year		(In thousands)
2020	$	-
2021		-
2022		-
2023		-
2024		295,307
Later years		290,812
Total	$	586,119