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Segment reporting | 9 Months Ended
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Sep. 30, 2023
Segment reporting disclosure |
Segment Reporting | Note 33 – 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, including U.S. based activities conducted through its New York Branch. 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 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, until August 15, 2022, 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: 2023 For the quarter ended September 30, 2023 Intersegment (In thousands) BPPR Popular U.S. Eliminations Net interest income $ 453,879 $ 87,445 $ 1 Provision for credit losses (benefit) 51,899 (6,644) - Non-interest income 144,691 5,894 (134) Amortization of intangibles 484 311 - Goodwill impairment charge - 23,000 - Depreciation expense 12,880 1,962 - Other operating expenses 369,738 58,341 (134) Income tax expense 40,861 5,358 - Net income $ 122,708 $ 11,011 $ 1 Segment assets $ 57,039,000 $ 12,806,630 $ (448,100) For the quarter ended September 30, 2023 Reportable (In thousands) Segments Corporate Eliminations Total Popular, Inc. Net interest income (expense) $ 541,325 $ (7,305) $ - $ 534,020 Provision for credit losses (benefit) 45,255 (138) - 45,117 Non-interest income 150,451 10,179 (1,081) 159,549 Amortization of intangibles 795 - - 795 Goodwill impairment charge 23,000 - - 23,000 Depreciation expense 14,842 381 - 15,223 Other operating expenses 427,945 180 (1,159) 426,966 Income tax expense (benefit) 46,219 (396) 36 45,859 Net income $ 133,720 $ 2,847 $ 42 $ 136,609 Segment assets $ 69,397,530 $ 5,554,370 $ (5,214,964) $ 69,736,936 For the nine months ended September 30, 2023 Intersegment (In thousands) BPPR Popular U.S. Eliminations Net interest income $ 1,356,774 $ 265,033 $ 2 Provision for credit losses 126,952 3,328 - Non-interest income 435,966 18,165 (404) Amortization of intangibles 1,453 932 - Goodwill impairment charge - 23,000 - Depreciation expense 36,424 5,661 - Other operating expenses 1,119,522 182,809 (404) Income tax expense 120,996 16,184 - Net income $ 387,393 $ 51,284 $ 2 Segment assets $ 57,039,000 $ 12,806,630 $ (448,100) For the nine months ended September 30, 2023 Reportable Total (In thousands) Segments Corporate Eliminations Popular, Inc. Net interest income (expense) $ 1,621,809 $ (24,465) $ - $ 1,597,344 Provision for credit losses (benefit) 130,280 (334) - 129,946 Non-interest income 453,727 32,905 (4,651) 481,981 Amortization of intangibles 2,385 - - 2,385 Goodwill impairment charge 23,000 - - 23,000 Depreciation expense 42,085 1,095 - 43,180 Other operating expenses 1,301,927 (146) (3,391) 1,298,390 Income tax expense (benefit) 137,180 (1,006) (498) 135,676 Net income $ 438,679 $ 8,831 $ (762) $ 446,748 Segment assets $ 69,397,530 $ 5,554,370 $ (5,214,964) $ 69,736,936 2022 For the quarter ended September 30, 2022 Intersegment (In thousands) BPPR Popular U.S. Eliminations Net interest income $ 488,123 $ 98,874 $ 1 Provision for credit losses 29,813 10,011 - Non-interest income 262,587 15,203 (137) Amortization of intangibles 484 311 - Goodwill impairment charge - 9,000 - Depreciation expense 11,862 1,693 - Other operating expenses 396,655 57,127 (135) Income tax expense 48,209 10,628 - Net income $ 263,687 $ 25,307 $ (1) Segment assets $ 59,640,784 $ 11,106,409 $ (319,999) For the quarter ended September 30, 2022 Reportable (In thousands) Segments Corporate Eliminations Total Popular, Inc. Net interest income (expense) $ 586,998 $ (7,379) $ - $ 579,619 Provision for credit losses (benefit) 39,824 (187) - 39,637 Non-interest income 277,653 148,228 613 426,494 Amortization of intangibles 795 - - 795 Goodwill impairment charge 9,000 - - 9,000 Depreciation expense 13,555 298 - 13,853 Other operating expenses 453,647 (46) (1,154) 452,447 Income tax expense 58,837 8,469 680 67,986 Net income $ 288,993 $ 132,315 $ 1,087 $ 422,395 Segment assets $ 70,427,194 $ 5,341,051 $ (5,038,570) $ 70,729,675 For the nine months ended September 30, 2022 Intersegment (In thousands) BPPR Popular U.S. Eliminations Net interest income $ 1,351,086 $ 278,825 $ 3 Provision for credit losses 24,941 8,580 - Non-interest income 542,826 26,076 (410) Amortization of intangibles 1,453 1,028 - Goodwill impairment charge - 9,000 - Depreciation expense 35,054 5,272 - Other operating expenses 1,069,512 166,677 (407) Income tax expense 141,113 33,917 - Net income $ 621,839 $ 80,427 $ - Segment assets $ 59,640,784 $ 11,106,409 $ (319,999) For the nine months ended September 30, 2022 Reportable Total (In thousands) Segments Corporate Eliminations Popular, Inc. Net interest income (expense) $ 1,629,914 $ (22,121) $ - $ 1,607,793 Provision for credit losses (benefit) 33,521 (22) - 33,499 Non-interest income 568,492 174,060 (3,955) 738,597 Amortization of intangibles 2,481 - - 2,481 Goodwill impairment charge 9,000 - - 9,000 Depreciation expense 40,326 881 - 41,207 Other operating expenses 1,235,782 (149) (3,609) 1,232,024 Income tax expense 175,030 7,802 (155) 182,677 Net income $ 702,266 $ 143,427 $ (191) $ 845,502 Segment assets $ 70,427,194 $ 5,341,051 $ (5,038,570) $ 70,729,675 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 mainland United States include commercial lending activities. BPPR’s commercial lending activities in the U.S., through its New York Branch, include periodic loan participations with PB. During the quarter and nine months ended, BPPR participated in loans originated by PB totaling $ 10 million and $ 33 million, respectively (2022 - $ 69 million and $ 160 million, respectively). At September 30, 2023, total assets for the BPPR segment related to its operations in the United States amounted to $ 1.4 billion (December 31, 2022 - $ 1.2 billion). During the nine months ended September 30, 2023, the BPPR segment generated approximately $ 86.0 million (2022 - $ 45.0 million) in revenues from its operations in the United States, including net interest income and other service fees. In the Virgin Islands, the BPPR segment offers banking products, including loans and deposits. The BPPR segment generated $ 33.6 million in revenues during the nine months ended September 30, 2023 (2022 - $ 34.6 million) from its operations in the U.S. and British Virgin Islands. Geographic Information Quarter ended Nine months ended (In thousands) September 30, 2023 September 30, 2022 September 30, 2023 September 30, 2022 Revenues: [1] Puerto Rico $ 539,985 $ 852,149 $ 1,623,963 $ 1,940,457 United States 131,698 133,071 389,463 347,614 Other 21,886 20,893 65,899 58,319 Total consolidated revenues $ 693,569 $ 1,006,113 $ 2,079,325 $ 2,346,390 [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 gain (loss) on trading account debt securities, net loss on sale of loans, including valuation adjustments on loans held-for-sale, adjustments to indemnity reserves on loans sold, and other operating income. Selected Balance Sheet Information: (In thousands) September 30, 2023 December 31, 2022 Puerto Rico Total assets $ 54,259,904 $ 53,541,427 Loans 21,866,754 20,884,442 Deposits 52,035,227 51,138,790 United States Total assets $ 14,218,288 $ 12,718,775 Loans 11,625,969 10,643,964 Deposits 9,605,215 8,182,702 Other Total assets $ 1,258,744 $ 1,377,715 Loans 541,829 554,744 Deposits [1] 1,697,158 1,905,735 [1] Represents deposits from BPPR operations located in the U.S. and British Virgin Islands.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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