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Segment reporting
 3 Months Ended
Mar. 31, 2022
Segment reporting disclosure  
Segment Reporting

Note 32 – Segment reporting

 

The Corporation’s corporate structure consists of two reportable segments – Banco Popular de Puerto Rico and Popular U.S. Management determined the reportable segments based on the internal reporting used to evaluate performance and to assess where to allocate resources. The segments were determined based on the organizational structure, which focuses primarily on the markets the segments serve, as well as on the products and services offered by the segments.

 

Banco Popular de Puerto Rico:

The Banco Popular de Puerto Rico reportable segment includes commercial, consumer and retail banking operations conducted at BPPR. It also includes the lending operations of Popular Auto and Popular Mortgage. Other financial services within the BPPR segment include the trust service units of BPPR, asset management services of Popular Asset Management, the brokerage and investment banking operations of Popular Securities, and the insurance agency and reinsurance businesses of Popular Insurance, Popular Risk Services, Popular Life Re, and Popular Re.

 

Popular U.S.:

Popular U.S. reportable segment consists of the banking operations of Popular Bank (PB), Popular Insurance Agency, U.S.A., and Popular Equipment Finance (PEF). PB operates through a retail branch network in the U.S. mainland under the name of Popular, and equipment leasing and financing services through PEF. Popular Insurance Agency, U.S.A. offers investment and insurance services across the PB branch network.

 

The Corporate group consists primarily of the holding companies Popular, Inc., Popular North America, Popular International Bank and certain of the Corporation’s investments accounted for under the equity method, including EVERTEC and Centro Financiero BHD, León.

 

The accounting policies of the individual operating segments are the same as those of the Corporation. Transactions between reportable segments are primarily conducted at market rates, resulting in profits that are eliminated for reporting consolidated results of operations.

 

The tables that follow present the results of operations and total assets by reportable segments:

2022

For the quarter ended March 31, 2022

 

 

 

 

Banco Popular

 

 

 

Intersegment

(In thousands)

 

 

 

de Puerto Rico

 

Popular U.S.

 

Eliminations

Net interest income

 

 

$

415,169

$

86,520

$

1

Provision for credit losses (benefit)

 

 

 

(13,690)

 

(2,019)

 

-

Non-interest income

 

 

 

135,862

 

5,954

 

(137)

Amortization of intangibles

 

 

 

484

 

407

 

-

Depreciation expense

 

 

 

11,517

 

1,824

 

-

Other operating expenses

 

 

 

334,878

 

53,639

 

(136)

Income tax expense

 

 

 

39,316

 

11,592

 

-

Net income

 

 

$

178,526

$

27,031

$

-

Segment assets

 

 

$

58,708,519

$

10,579,410

$

(167,754)

 

 

 

 

 

 

 

 

 

For the quarter ended March 31, 2022

 

 

Reportable

 

 

 

 

 

 

(In thousands)

 

Segments

 

Corporate

 

Eliminations

 

Total Popular, Inc.

Net interest income (expense)

$

501,690

$

(7,378)

$

-

$

494,312

Provision for credit losses (benefit)

 

(15,709)

 

209

 

-

 

(15,500)

Non-interest income

 

141,679

 

14,265

 

(1,252)

 

154,692

Amortization of intangibles

 

891

 

-

 

-

 

891

Depreciation expense

 

13,341

 

289

 

-

 

13,630

Other operating expenses

 

388,381

 

444

 

(1,007)

 

387,818

Income tax expense (benefit)

 

50,908

 

(332)

 

(97)

 

50,479

Net income

$

205,557

$

6,277

$

(148)

$

211,686

Segment assets

$

69,120,175

$

5,490,318

$

(5,085,411)

$

69,525,082

2021

For the quarter ended March 31, 2021

 

 

 

 

Banco Popular

 

 

 

Intersegment

(In thousands)

 

 

 

de Puerto Rico

 

Popular U.S.

 

Eliminations

Net interest income

 

 

$

410,323

$

79,169

$

2

Provision for credit losses (benefit)

 

 

 

(45,361)

 

(36,720)

 

-

Non-interest income

 

 

 

135,208

 

5,666

 

(138)

Amortization of intangibles

 

 

 

861

 

166

 

-

Depreciation expense

 

 

 

12,143

 

2,328

 

-

Other operating expenses

 

 

 

306,920

 

53,194

 

(136)

Income tax expense

 

 

 

58,813

 

18,035

 

-

Net income

 

 

$

212,155

$

47,832

$

-

Segment assets

 

 

$

55,990,801

$

10,557,751

$

(41,613)

 

 

 

 

 

 

 

 

 

For the quarter ended March 31, 2021

 

 

Reportable

 

 

 

 

 

 

(In thousands)

 

Segments

 

Corporate

 

Eliminations

 

Total Popular, Inc.

Net interest income (expense)

$

489,494

$

(10,382)

$

-

$

479,112

Provision for credit losses (benefit)

 

(82,081)

 

(145)

 

-

 

(82,226)

Non-interest income

 

140,736

 

13,150

 

(233)

 

153,653

Amortization of intangibles

 

1,027

 

24

 

-

 

1,051

Depreciation expense

 

14,471

 

267

 

-

 

14,738

Other operating expenses

 

359,978

 

670

 

(909)

 

359,739

Income tax expense (benefit)

 

76,848

 

(333)

 

316

 

76,831

Net income

$

259,987

$

2,285

$

360

$

262,632

Segment assets

$

66,506,939

$

5,193,058

$

(4,829,729)

$

66,870,268

Geographic Information

 

The following information presents selected financial information based on the geographic location where the Corporation conducts its business. The banking operations of BPPR are primarily based in Puerto Rico, where it has the largest retail banking franchise. BPPR also conducts banking operations in the U.S. Virgin Islands, the British Virgin Islands and New York. BPPR’s banking operations in the United States include E-loan, an online platform used to offer personal loans, co-branded credit cards offerings and an online deposit gathering platform. In the Virgin Islands, the BPPR segment offers banking products, including loans and deposits. During the quarter ended March 31, 2022, the BPPR segment generated approximately $12.0 million (2021- $12.7 million) in revenues from its operations in the United States, including net interest income, service charges on deposit accounts and other service fees. In addition, the BPPR segment generated $10.8 million in revenues (2021- $11.6 million) from its operations in the U.S. and British Virgin Islands. At March 31, 2022, total assets for the BPPR segment related to its operations in the United States amounted to $700 million (December 31, 2021- $589 million).

Geographic Information

 

 

 

Quarter ended

(In thousands)

 

March 31, 2022

 

March 31, 2021

Revenues:[1]

 

 

 

 

Puerto Rico

$

527,673

$

518,709

United States

 

103,174

 

96,012

Other

 

18,157

 

18,044

Total consolidated revenues

$

649,004

$

632,765

[1]

Total revenues include net interest income, service charges on deposit accounts, other service fees, mortgage banking activities, net (loss) gain, including impairment on equity securities, net loss on trading account debt securities, indemnity reserves on loans sold expense and other operating income.

Selected Balance Sheet Information:

(In thousands)

 

March 31, 2022

 

December 31, 2021

Puerto Rico

 

 

 

 

 

Total assets

$

56,904,970

$

63,221,282

 

Loans

 

19,823,507

 

19,770,118

 

Deposits

 

53,004,727

 

57,211,608

United States

 

 

 

 

 

Total assets

$

11,234,624

$

10,986,055

 

Loans

 

9,201,713

 

8,903,493

 

Deposits

 

7,843,062

 

7,777,232

Other

 

 

 

 

 

Total assets

$

1,385,488

$

890,562

 

Loans

 

618,120

 

626,115

 

Deposits[1]

 

2,014,506

 

2,016,248

[1]

Represents deposits from BPPR operations located in the U.S. and British Virgin Islands.