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Allowance for credit losses - loans held-in-portfolio | 12 Months Ended
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Dec. 31, 2023
Allowance for credit losses [Abstract] |
Allowance for credit losses | Note 9 – Allowance for credit losses – loans held-in-portfolio The Corporation follows the current expected credit loss (“CECL”) model, to establish and evaluate the adequacy of the ACL to provide for expected losses in the loan portfolio. This model establishes a forward-looking methodology that reflects the expected credit losses over the lives of financial assets, starting when such assets are first acquired or originated. In addition, CECL provides that the initial ACL on PCD financial assets be recorded as an increase to the purchase price, with subsequent changes to the allowance recorded as a credit loss expense. The provision for credit losses recorded in current operations is based on this methodology. Loan losses are charged, and recoveries are credited to the ACL. The Corporation’s modeling framework includes competing risk models that generate lifetime default and prepayment estimates as well as other loan level techniques to estimate loss severity. These models combine credit risk factors, which include the impact of loan modifications, with macroeconomic expectations to derive the lifetime expected loss. As part of the Corporation’s model governance procedures, a new model was implemented during the third quarter of 2023 for the U.S commercial real estate segment. The new model enhances techniques used to capture default activity within the Corporation’s geographical footprint. As part of the implementation analysis management evaluated the credit metrics of the portfolio such as risk ratings, delinquency levels, and low exposure to the commercial office sector. Qualitative reserves continue to be maintained to address risks within the U. S. commercial real estate segment. The new model including qualitative reserve accounted for $ 15 million of PB’s reduction in ACL during the third quarter of 2023. At December 31,2023, the Corporation estimated the ACL by weighting the outputs of optimistic, baseline, and pessimistic scenarios. Among the three scenarios used to estimate the ACL, the baseline is assigned the highest probability, followed by the pessimistic scenario given the uncertainties in the economic outlook and downside risk. The weightings applied are subject to evaluation on a quarterly basis as part of the ACL’s governance process. The Corporation evaluates, at least on an annual basis, the assumptions tied to the CECL accounting framework. These include the reasonable and supportable period as well as the reversion window. During the third quarter of 2022, as part of its evaluation procedures, the Corporation decided to extend the reversion window from 1 year to 3 years. The extension in the reversion window results in a better representation of historical movements for key macroeconomic variables that impact the ACL. The reasonable and supportable period assumptions remained unchanged at 2 years. The baseline scenario assumes a 2024 annualized GDP growth for Puerto Rico and the United States of 1.21% and 1.65%. For 2023, annualized expected growth was 2.0% and 2.4% for Puerto Rico and United States, respectively. The reduction in 2024 is due to the Fed’s monetary policy. The 2024 average unemployment rate is forecasted at 6.79% and 3.95% for Puerto Rico and United States, respectively, compared to 2023 average level 6.1% for Puerto Rico and 3.7% for the United States. The following tables present the changes in the ACL of loans held-in-portfolio and unfunded commitments for the years ended December 31, 2023 and 2022. For the year ended December 31, 2023 BPPR Impact of Provision for Allowance for Net write down Beginning Adopting credit losses credit losses - Ending (In thousands) Balance ASU 2022-02 (benefit) PCD Loans Charge-off Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 5,210 $ - $ (1,597) $ - $ - $ 1 $ - $ 3,614 Commercial real estate non-owner occupied 52,475 - 980 - (1,130) 1,429 - 53,754 Commercial real estate owner occupied 48,393 (1,161) (5,495) - (4,437) 3,337 - 40,637 Commercial and industrial 68,217 (552) 29,911 - (7,739) 17,740 - 107,577 Total Commercial 174,295 (1,713) 23,799 - (13,306) 22,507 - 205,582 Construction 2,978 - 4,926 - (2,611) 1 - 5,294 Mortgage 117,344 (33,556) (25,295) 89 (1,638) 15,496 - 72,440 Leasing 20,618 (35) (3,836) - (10,879) 3,840 - 9,708 Consumer Credit cards 58,670 - 54,649 - (41,007) 8,776 (601) 80,487 Home equity lines of credit 103 - (155) - (213) 368 - 103 Personal 96,369 (7,020) 74,226 - (71,977) 9,583 - 101,181 Auto 129,735 (21) 63,185 - (55,306) 20,338 - 157,931 Other 15,433 - 3,335 - (12,454) 818 - 7,132 Total Consumer 300,310 (7,041) 195,240 - (180,957) 39,883 (601) 346,834 Total - Loans $ 615,545 $ (42,345) $ 194,834 $ 89 $ (209,391) $ 81,727 $ (601) $ 639,858 Allowance for credit losses - unfunded commitments: Commercial $ 4,336 $ - $ 726 $ - $ - $ - $ - $ 5,062 Construction 2,022 - (404) - - - - 1,618 Ending balance - unfunded commitments [1] $ 6,358 $ - $ 322 $ - $ - $ - $ - $ 6,680 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. For the year ended December 31, 2023 Popular U.S. Impact of Provision for Beginning Adopting credit losses - Ending (In thousands) Balance ASU 2022-02 (benefit) Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 21,101 $ - $ (10,980) $ - $ 5 $ 10,126 Commercial real estate non-owner occupied 19,065 - (9,222) (193) 2,049 11,699 Commercial real estate owner occupied 8,688 - 8,851 (1,395) 83 16,227 Commercial and industrial 12,227 - 4,557 (3,875) 1,870 14,779 Total Commercial 61,081 - (6,794) (5,463) 4,007 52,831 Construction 1,268 - 6,124 - - 7,392 Mortgage 17,910 (2,098) (5,248) - 210 10,774 Consumer Credit cards - - 1 (1) - - Home equity lines of credit 2,439 - (1,058) (471) 965 1,875 Personal 22,057 (1,140) 13,521 (19,971) 2,142 16,609 Other 2 - 159 (171) 12 2 Total Consumer 24,498 (1,140) 12,623 (20,614) 3,119 18,486 Total - Loans $ 104,757 $ (3,238) $ 6,705 $ (26,077) $ 7,336 $ 89,483 Allowance for credit losses - unfunded commitments: Commercial $ 1,175 $ - $ 676 $ - $ - $ 1,851 Construction 1,184 - 7,262 - - 8,446 Consumer 88 - (59) - - 29 Ending balance - unfunded commitments [1] $ 2,447 $ - $ 7,879 $ - $ - $ 10,326 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. For the year ended December 31, 2023 Popular Inc. Impact Provision for Allowance for Net write down Beginning of adopting credit losses credit losses - Ending (In thousands) Balance ASU 2022-02 (benefit) PCD Loans Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 26,311 $ - $ (12,577) $ - $ - $ 6 $ - $ 13,740 Commercial real estate non-owner occupied 71,540 - (8,242) - (1,323) 3,478 - 65,453 Commercial real estate owner occupied 57,081 (1,161) 3,356 - (5,832) 3,420 - 56,864 Commercial and industrial 80,444 (552) 34,468 - (11,614) 19,610 - 122,356 Total Commercial 235,376 (1,713) 17,005 - (18,769) 26,514 - 258,413 Construction 4,246 - 11,050 - (2,611) 1 - 12,686 Mortgage 135,254 (35,654) (30,543) 89 (1,638) 15,706 - 83,214 Leasing 20,618 (35) (3,836) - (10,879) 3,840 - 9,708 Consumer Credit cards 58,670 - 54,650 - (41,008) 8,776 (601) 80,487 Home equity lines of credit 2,542 - (1,213) - (684) 1,333 - 1,978 Personal 118,426 (8,160) 87,747 - (91,948) 11,725 - 117,790 Auto 129,735 (21) 63,185 - (55,306) 20,338 - 157,931 Other 15,435 - 3,494 - (12,625) 830 - 7,134 Total Consumer 324,808 (8,181) 207,863 - (201,571) 43,002 (601) 365,320 Total - Loans $ 720,302 $ (45,583) $ 201,539 $ 89 $ (235,468) $ 89,063 $ (601) $ 729,341 Allowance for credit losses - unfunded commitments: Commercial $ 5,511 $ - $ 1,402 $ - $ - $ - $ - $ 6,913 Construction 3,206 - 6,858 - - - - 10,064 Consumer 88 - (59) - - - - 29 Ending balance - unfunded commitments [1] $ 8,805 $ - $ 8,201 $ - $ - $ - $ - $ 17,006 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. For the year ended December 31, 2022 BPPR Provision for Allowance for Beginning credit losses credit losses - Ending (In thousands) Balance (benefit) PCD Loans Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 3,050 $ 2,160 $ - $ - $ - $ 5,210 Commercial real estate non-owner occupied 45,211 5,744 - (34) 1,554 52,475 Commercial real estate owner occupied 54,176 (12,405) - (1,063) 7,685 48,393 Commercial and industrial 49,491 15,976 - (6,141) 8,891 68,217 Total Commercial 151,928 11,475 - (7,238) 18,130 174,295 Construction 1,641 526 - - 811 2,978 Mortgage 138,286 (37,600) 915 (5,105) 20,848 117,344 Leasing 17,578 6,832 - (7,107) 3,315 20,618 Consumer Credit cards 43,499 32,582 - (26,210) 8,799 58,670 Home equity lines of credit 98 (273) - (191) 469 103 Personal 71,022 54,279 - (36,179) 7,247 96,369 Auto 154,498 843 - (42,143) 16,537 129,735 Other 15,612 880 - (2,029) 970 15,433 Total Consumer 284,729 88,311 - (106,752) 34,022 300,310 Total - Loans $ 594,162 $ 69,544 $ 915 $ (126,202) $ 77,126 $ 615,545 Allowance for credit losses - unfunded commitments: Commercial $ 1,751 $ 2,585 $ - $ - $ - $ 4,336 Construction 2,388 (366) - - - 2,022 Ending balance - unfunded commitments [1] $ 4,139 $ 2,219 $ - $ - $ - $ 6,358 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. For the year ended December 31, 2022 Popular U.S. Provision for Beginning credit losses Ending (In thousands) Balance (benefit) Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 25,418 $ (4,338) $ - $ 21 $ 21,101 Commercial real estate non-owner occupied 22,246 5,468 (8,671) 22 19,065 Commercial real estate owner occupied 6,053 2,276 (6) 365 8,688 Commercial and industrial 10,160 1,191 (1,335) 2,211 12,227 Total Commercial 63,877 4,597 (10,012) 2,619 61,081 Construction 4,722 (4,586) - 1,132 1,268 Mortgage 16,192 1,706 (68) 80 17,910 Consumer Credit cards - (13) - 13 - Home equity lines of credit 3,708 (3,713) (430) 2,874 2,439 Personal 12,700 15,619 (7,404) 1,142 22,057 Other 5 153 (202) 46 2 Total Consumer 16,413 12,046 (8,036) 4,075 24,498 Total - Loans $ 101,204 $ 13,763 $ (18,116) $ 7,906 $ 104,757 Allowance for credit losses - unfunded commitments: Commercial $ 1,384 $ (209) $ - $ - $ 1,175 Construction 2,337 (1,153) - - 1,184 Consumer 37 51 - - 88 Ending balance - unfunded commitments [1] $ 3,758 $ (1,311) $ - $ - $ 2,447 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. For the year ended December 31, 2022 Popular Inc. Provision for Allowance for Beginning credit losses credit losses - Ending (In thousands) Balance (benefit) PCD Loans Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 28,468 $ (2,178) $ - $ - $ 21 $ 26,311 Commercial real estate non-owner occupied 67,457 11,212 - (8,705) 1,576 71,540 Commercial real estate owner occupied 60,229 (10,129) - (1,069) 8,050 57,081 Commercial and industrial 59,651 17,167 - (7,476) 11,102 80,444 Total Commercial 215,805 16,072 - (17,250) 20,749 235,376 Construction 6,363 (4,060) - - 1,943 4,246 Mortgage 154,478 (35,894) 915 (5,173) 20,928 135,254 Leasing 17,578 6,832 - (7,107) 3,315 20,618 Consumer Credit cards 43,499 32,569 - (26,210) 8,812 58,670 Home equity lines of credit 3,806 (3,986) - (621) 3,343 2,542 Personal 83,722 69,898 - (43,583) 8,389 118,426 Auto 154,498 843 - (42,143) 16,537 129,735 Other 15,617 1,033 - (2,231) 1,016 15,435 Total Consumer 301,142 100,357 - (114,788) 38,097 324,808 Total - Loans $ 695,366 $ 83,307 $ 915 $ (144,318) $ 85,032 $ 720,302 Allowance for credit losses - unfunded commitments: Commercial $ 3,135 $ 2,376 $ - $ - $ - $ 5,511 Construction 4,725 (1,519) - - - 3,206 Consumer 37 51 - - - 88 Ending balance - unfunded commitments [1] $ 7,897 $ 908 $ - $ - $ - $ 8,805 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. Modifications A modification constitutes a change in loan terms in the form of principal forgiveness, an interest rate reduction, other than- insignificant payment delay, term extension or combination of the above made to a borrower experiencing financial difficulty. The amount of outstanding commitments to lend additional funds to debtors with financial difficulties owing receivables whose terms have been modified during the year ended December 31, 2023 amounted to $ 21 million related to the commercial and construction loan portfolios. The following tables show the amortized cost basis of the loans modified to borrowers experiencing financial difficulties at the end of the reporting period disaggregated by class of financing receivable and type of concession granted for the year ended December 31,2023. Loans modified to borrowers under financial difficulties that were fully paid down, charged-off or foreclosed upon by period end are not reported. Loan Modifications Made to Borrowers Experiencing Financial Difficulty for the year ended December 31,2023 Interest Rate Reduction BPPR Popular U.S. Popular, Inc. (Dollars in thousands) Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable CRE owner occupied $ 141,291 10.10 % $ - - % $ 141,291 4.59 % Commercial and industrial 70 - % - - % 70 - % Mortgage 301 - % - - % 301 - % Consumer: Credit cards 700 0.06 % - - % 700 0.06 % Personal 783 0.04 % 2 - % 785 0.04 % Other 6 - % - - % 6 - % Total $ 143,151 0.58 % $ 2 - % $ 143,153 0.41 % Term Extension BPPR Popular U.S. Popular, Inc. (Dollars in thousands) Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable CRE non-owner occupied $ 33,318 1.11 % $ - - % $ 33,318 0.65 % CRE owner occupied 4,921 0.35 % 60,669 3.61 % 65,590 2.13 % Commercial and industrial 39,445 0.82 % 250 0.01 % 39,695 0.56 % Construction - - % 5,990 0.76 % 5,990 0.62 % Mortgage 53,447 0.84 % 5,450 0.42 % 58,897 0.77 % Consumer: Personal 413 0.02 % 129 0.08 % 542 0.03 % Auto 91 - % - - % 91 - % Total $ 131,635 0.54 % $ 72,488 0.69 % $ 204,123 0.58 % Other-Than-Insignificant Payment Delays BPPR Popular U.S. Popular, Inc. (Dollars in thousands) Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable CRE non-owner occupied $ 1,854 0.06 % $ - - % $ 1,854 0.04 % CRE owner occupied 16,068 1.15 % 13,468 0.80 % 29,536 0.96 % Commercial and industrial 10,545 0.22 % 814 0.03 % 11,359 0.16 % Mortgage 137 - % - - % 137 - % Total $ 28,604 0.12 % $ 14,282 0.14 % $ 42,886 0.12 % Combination - Term extension and Interest Rate Reduction BPPR Popular U.S. Popular, Inc. (Dollars in thousands) Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Commercial multi-family $ 65 0.02 % $ - - % $ 65 - % CRE non-owner occupied 19,983 0.66 % $ - - % 19,983 0.39 % CRE owner occupied 14,416 1.03 % - - % 14,416 0.47 % Commercial and industrial 335 0.01 % - - % 335 - % Mortgage 37,179 0.58 % 405 0.03 % 37,584 0.49 % Consumer: Personal 2,318 0.13 % 62 0.04 % 2,380 0.12 % Auto 27 - % - - % 27 - % Total $ 74,323 0.30 % $ 467 - % $ 74,790 0.21 % Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction Puerto Rico Popular U.S. Popular, Inc. (Dollars in thousands) Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable CRE non-owner occupied $ 180 0.01 % $ - - % $ 180 - % Commercial and industrial 199 - % - - % 199 - % Consumer: Credit cards 814 0.07 % - - % 814 0.07 % Total $ 1,193 - % $ - - % $ 1,193 - % Combination - Other-Than-Insignificant Payment Delays and Principal Forgiveness Puerto Rico Popular U.S. Popular, Inc. (Dollars in thousands) Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable Amortized Cost Basis at December 31,2023 % of total class of Financing Receivable CRE owner occupied $ 158 0.01 % $ - - % $ 158 0.01 % Total $ 158 - % $ - - % $ 158 - % The following table describes the financial effect of the modifications made to borrowers experiencing financial difficulties: For the year ended December 31, 2023 Interest rate reduction Loan Type Financial Effect Commercial multi-family Reduced weighted-average contractual interest rate from 7.5 % to 5.3 %. CRE non-owner occupied Reduced weighted-average contractual interest rate from 9.1 % to 7.3 %. CRE owner occupied Reduced weighted-average contractual interest rate from 8.4 % to 6.6 %. Commercial and industrial Reduced weighted-average contractual interest rate from 17.8 % to 7.8 %. Mortgage Reduced weighted-average contractual interest rate from 5.8 % to 4.2 %. Consumer: Credit cards Reduced weighted-average contractual interest rate from 18.8 % to 4.5 %. Personal Reduced weighted-average contractual interest rate from 17.8 % to 9.3 %. Auto Reduced weighted-average contractual interest rate from 12.64 % to 12.62 %. Other Reduced weighted-average contractual interest rate from 18 .0% to 0.0%. Term extension Loan Type Financial Effect Commercial multi-family Added a weighted-average of 43 years to the life of loans. CRE non-owner occupied Added a weighted-average of 20 months to the life of loans. CRE owner occupied Added a weighted-average of 1 year to the life of loans. Commercial and industrial Added a weighted-average of 2 years to the life of loans. Construction Added a weighted-average of 1 year to the life of loans. Mortgage Added a weighted-average of 11 years to the life of loans. Consumer: Personal Added a weighted-average of 8 years to the life of loans. Auto Added a weighted-average of 2 years to the life of loans. Principal forgiveness Loan Type Financial Effect CRE owner occupied Reduced the amortized cost basis of the loans by $ 88 thousand. Other than insignificant payment delay Loan Type Financial Effect CRE non-owner occupied Added a weighted-average of 11 months to the life of loans. CRE owner occupied Added a weighted-average of 9 months to the life of loans. Commercial and industrial Added a weighted-average of 7 months to the life of loans. Mortgage Added a weighted-average of 40 months to the life of loans. Consumer: Credit cards Added a weighted-average of 25 months to the life of loans. The following table presents, by class, the performance of loans that have been modified during the year ended December 31, 2023. The past due 90 days or more categories includes all loans modified classified as non-accruing at the time of the modification. These loans will continue in non-accrual status, and presented as past due 90 days or more, until the borrower has demonstrated a willingness and ability to make the restructured loan payments (at least six months of sustained performance after the modification or one year for loans providing for quarterly or semi-annual payments) and management has concluded that it is probable that the borrower would not be in payment default in the foreseeable future. BPPR December 31, 2023 Past Due 90 days or more [1] (In thousands) 30-59 days 60-89 days Past due 90 days or more Total past due Current Total With Payment Default Without Payment Default Commercial multi-family $ - $ - $ 65 $ 65 $ - $ 65 $ - $ 65 CRE non-owner occupied - - 2,094 2,094 53,241 55,335 - 2,094 CRE owner occupied 339 - 2,267 2,606 174,248 176,854 - 2,267 Commercial and industrial 2,519 77 14,881 17,477 33,117 50,594 556 14,325 Mortgage 7,520 3,358 28,128 39,006 52,058 91,064 8,319 19,809 Consumer: Credit cards 59 51 294 404 1,110 1,514 176 118 Personal 140 - 817 957 2,557 3,514 63 754 Auto - - 15 15 103 118 - 15 Other - - - - 6 6 - - Total $ 10,577 $ 3,486 $ 48,561 $ 62,624 $ 316,440 $ 379,064 $ 9,114 $ 39,447 [1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability to make the restructured loan payments. 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 with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Popular U.S. December 31, 2023 Past Due 90 days or more [1] (In thousands) 30-59 days 60-89 days Past due 90 days or more Total past due Current Total With Payment Default Without Payment Default CRE owner occupied $ - $ - $ - $ - $ 74,137 $ 74,137 $ - $ - Commercial and industrial - 250 - 250 814 1,064 - - Construction - - - - 5,990 5,990 - - Mortgage - - 388 388 5,467 5,855 - 388 Consumer: Personal - - 125 125 68 193 - 125 Total $ - $ 250 $ 513 $ 763 $ 86,476 $ 87,239 $ - $ 513 [1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability to make the restructured loan payments. 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 with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Popular Inc. December 31, 2023 Past Due 90 days or more [1] (In thousands) 30-59 days 60-89 days Past due 90 days or more Total past due Current Total With Payment Default Without Payment Default Commercial multi-family $ - $ - $ 65 $ 65 $ - $ 65 $ - $ 65 CRE non-owner occupied - - 2,094 2,094 53,241 55,335 - 2,094 CRE owner occupied 339 - 2,267 2,606 248,385 250,991 - 2,267 Commercial and industrial 2,519 327 14,881 17,727 33,931 51,658 556 14,325 Construction - - - - 5,990 5,990 - - Mortgage 7,520 3,358 28,516 39,394 57,525 96,919 8,319 20,197 Consumer: Credit cards 59 51 294 404 1,110 1,514 176 118 Personal 140 - 942 1,082 2,625 3,707 63 879 Auto - - 15 15 103 118 - 15 Other - - - - 6 6 - - Total $ 10,577 $ 3,736 $ 49,074 $ 63,387 $ 402,916 $ 466,303 $ 9,114 $ 39,960 [1] Loans that were in non-accrual status at the time of modification are presented as past due until the borrower has demonstrated a willingness and ability to make the restructured loan payments. 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 with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. During the year ended December 31, 2023, the outstanding balance of loans modified for borrowers under financial difficulties that were subject to payment default during the year ended preceding the default date was $ 10 million. For the year ended December 31, 2023, extension of maturity and the combination of reduction of interest rate and extension of maturity amounted to $ 8 million and $ 2 million, respectively, of the outstanding balance of loans modified for borrowers under financial difficulties that were subject to payment default during the year preceding the default date. Legacy TDR Modifications A modification of a loan, prior to ASU 2022-02, constituted a troubled debt restructuring (TDR) when a borrower was experiencing financial difficulty and the modification constituted a concession. For a summary of the legacy accounting policy related to TDRs, refer to the Summary of Significant Accounting Policies included in Note 2 to the 2022 Form 10-K. The outstanding balance of loans classified as TDRs amounted to $ 1.6 billion at December 31, 2022. The amount of outstanding commitments to lend additional funds to debtors owing receivables whose terms have been modified in TDRs amounted to $ 12 million related to the commercial and construction loan portfolios at December 31, 2022. The following table presents the outstanding balance of loans classified as TDRs according to their accruing status and the related allowance at December 31, 2022. December 31, 2022 (In thousands) Accruing Non-Accruing Total Related Allowance Loans held-in-portfolio: Commercial $ 269,784 $ 54,641 $ 324,425 $ 18,451 Mortgage [1] 1,169,976 86,790 1,256,766 58,819 Leasing 1,154 24 1,178 43 Consumer 54,395 7,883 62,278 13,577 Loans held-in-portfolio $ 1,495,309 $ 149,338 $ 1,644,647 $ 90,890 [1] At December 31, 2022, accruing mortgage loan TDRs include $ 725 million guaranteed by U.S. sponsored entities at BPPR. The following table presents the loan count by type of modification for those loans modified in a TDR during the year ended December 31, 2022. Loans modified as TDRs for the U.S. operations are considered insignificant to the Corporation. Popular Inc. For the year ended December 31, 2022 Reduction in interest rate Extension of maturity date Combination of reduction in interest rate and extension of maturity date Other Commercial real estate non-owner occupied - 2 2 4 Commercial real estate owner occupied 3 10 1 14 Commercial and industrial 4 9 1 16 Mortgage 7 217 881 5 Leasing - 2 1 34 Consumer: Credit cards 48 - - 48 HELOCs - - 1 - Personal 111 111 3 40 Auto - 1 - 129 Other 1 - - - Total 174 352 890 290 The following table presents, by class, quantitative information related to loans modified as TDRs during year ended December 31, 2022. Popular, Inc. For the year ended December 31, 2022 (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 real estate non-owner occupied 8 $ 6,530 $ 6,527 $ 60 Commercial real estate owner occupied 28 19,192 19,165 (2,078) Commercial and industrial 30 51,139 50,929 2,120 Mortgage 1,110 128,581 125,875 4,447 Leasing 37 1,181 1,180 13 Consumer: Credit cards 96 866 898 10 HELOCs 1 245 236 67 Personal 265 3,581 3,479 671 Auto 130 1,631 1,631 5 Other 1 8 8 1 Total 1,706 $ 212,954 $ 209,928 $ 5,316 The following table presents, 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. Popular Inc. Defaulted during the year ended December 31, 2022 (Dollars in thousands) Loan count Recorded investment as of first default date Commercial real estate owner occupied 2 $ 620 Commercial and industrial 7 6,639 Mortgage 75 9,391 Leasing 1 5 Consumer: Credit cards 29 249 Personal 49 918 Total 163 $ 17,822 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 allowance for credit 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 risk rating analysis process is performed at least once a year or more frequently if events or conditions change which may deteriorate the credit quality. In the case of consumer and mortgage loans, these loans are classified considering their delinquency status at the end of the reporting period. 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 following tables present the amortized cost basis, net of unearned income, of loans held-in-portfolio based on the Corporation’s assignment of obligor risk ratings as defined at December 31, 2023 and 2022 by vintage year. December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total BPPR Commercial: Commercial multi-family Watch $ - $ - $ - $ - $ 1,068 $ 5,179 $ - $ - $ 6,247 Special Mention - 559 - - - 4,780 - - 5,339 Substandard - - - - - 4,832 - - 4,832 Pass 37,976 138,619 21,334 20,487 32,554 24,248 306 - 275,524 Total commercial multi-family $ 37,976 $ 139,178 $ 21,334 $ 20,487 $ 33,622 $ 39,039 $ 306 $ - $ 291,942 Commercial real estate non-owner occupied Watch $ 1,959 $ 882 $ 5,205 $ 22,211 $ 5,938 $ 27,015 $ - $ - $ 63,210 Special Mention 43,020 5,413 24,730 - 15,843 68,368 - - 157,374 Substandard 1,016 1,307 180 2,231 53,729 12,968 4,069 - 75,500 Pass 305,243 871,191 560,785 359,853 41,262 563,794 7,042 - 2,709,170 Total commercial real estate non- owner occupied $ 351,238 $ 878,793 $ 590,900 $ 384,295 $ 116,772 $ 672,145 $ 11,111 $ - $ 3,005,254 Year-to-Date gross write-offs $ - $ - $ - $ 609 $ - $ 521 $ - $ - $ 1,130 Commercial real estate owner occupied Watch $ 2,947 $ 45,106 $ 9,913 $ 4,285 $ 5,017 $ 62,217 $ 1,000 $ - $ 130,485 Special Mention - 16,860 20,741 1,462 887 44,069 - - 84,019 Substandard 1,316 15,710 5,080 143,696 845 87,383 12,617 - 266,647 Doubtful - - - - - 136 - - 136 Pass 92,234 155,819 227,246 51,038 24,184 357,429 9,146 - 917,096 Total commercial real estate owner occupied $ 96,497 $ 233,495 $ 262,980 $ 200,481 $ 30,933 $ 551,234 $ 22,763 $ - $ 1,398,383 Year-to-Date gross write-offs $ - $ 4 $ - $ - $ 1 $ 4,432 $ - $ - $ 4,437 Commercial and industrial Watch $ 28,841 $ 95,785 $ 6,111 $ 4,043 $ 15,560 $ 65,360 $ 182,756 $ - $ 398,456 Special Mention 6,401 3,269 276 3,200 2,088 41,289 9,410 - 65,933 Substandard 731 1,760 8,644 22,065 1,922 32,087 40,670 - 107,879 Doubtful - - - 54 - 26 - - 80 Pass 1,109,898 634,401 511,912 241,452 123,458 258,872 1,343,885 - 4,223,878 Total commercial and industrial $ 1,145,871 $ 735,215 $ 526,943 $ 270,814 $ 143,028 $ 397,634 $ 1,576,721 $ - $ 4,796,226 Year-to-Date gross write-offs $ 896 $ 184 $ 215 $ 335 $ 555 $ 1,086 $ 4,468 $ - $ 7,739 Construction Watch $ - $ 16,546 $ 5,458 $ - $ - $ - $ 9,506 $ - $ 31,510 Special Mention - - 1,009 - - - 1 - 1,010 Substandard - 6,378 - - - - $ - - 6,378 Pass 26,662 24,462 27,364 10,758 1,944 1,049 38,720 - 130,959 Total construction $ 26,662 $ 47,386 $ 33,831 $ 10,758 $ 1,944 $ 1,049 $ 48,227 $ - $ 169,857 Year-to-Date gross write-offs $ - $ 2,611 $ - $ - $ - $ - $ - $ - $ 2,611 Mortgage Substandard $ 96 $ 161 $ 162 $ 345 $ 2,606 $ 71,893 $ - $ - $ 75,263 Pass 751,532 439,373 421,297 259,412 164,438 4,280,509 - - 6,316,561 Total mortgage $ 751,628 $ 439,534 $ 421,459 $ 259,757 $ 167,044 $ 4,352,402 $ - $ - $ 6,391,824 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 1,638 $ - $ - $ 1,638 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total BPPR Leasing Substandard $ 806 $ 2,516 $ 3,053 $ 906 $ 818 $ 517 $ - $ - $ 8,616 Loss - - - - - 17 - - 17 Pass 647,659 488,506 313,133 163,189 88,983 21,706 - - 1,723,176 Total leasing $ 648,465 $ 491,022 $ 316,186 $ 164,095 $ 89,801 $ 22,240 $ - $ - $ 1,731,809 Year-to-Date gross write-offs $ 1,065 $ 4,424 $ 2,878 $ 849 $ 976 $ 687 $ - $ - $ 10,879 Consumer: Credit cards Substandard $ - $ - $ - $ - $ - $ - $ 23,259 $ - $ 23,259 Loss - - - - - - 22 - 22 Pass - - - - - - 1,112,447 - 1,112,447 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,135,728 $ - $ 1,135,728 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 41,007 $ - $ 41,007 HELOCs Substandard $ - $ - $ - $ - $ - $ - $ 26 $ - $ 26 Pass $ - $ - $ - $ - $ - $ - $ 2,622 $ - $ 2,622 Total HELOCs $ - $ - $ - $ - $ - $ - $ 2,648 $ - $ 2,648 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 213 $ - $ 213 Personal Substandard $ 1,815 $ 4,985 $ 1,939 $ 493 $ 933 $ 8,322 $ - $ 1,006 $ 19,493 Loss - - 14 - 12 37 - - 63 Pass 859,434 480,771 181,483 57,227 58,849 96,956 - 22,034 1,756,754 Total Personal $ 861,249 $ 485,756 $ 183,436 $ 57,720 $ 59,794 $ 105,315 $ - $ 23,040 $ 1,776,310 Year-to-Date gross write-offs $ 4,458 $ 35,915 $ 18,076 $ 4,210 $ 4,891 $ 2,952 $ - $ 1,475 $ 71,977 Auto Substandard $ 6,980 $ 14,049 $ 11,916 $ 9,157 $ 7,051 $ 3,199 $ - $ - $ 52,352 Loss 9 44 45 16 9 6 - - 129 Pass 1,210,622 899,797 711,439 405,768 260,355 120,318 - - 3,608,299 Total Auto $ 1,217,611 $ 913,890 $ 723,400 $ 414,941 $ 267,415 $ 123,523 $ - $ - $ 3,660,780 Year-to-Date gross write-offs $ 10,170 $ 23,849 $ 11,820 $ 5,914 $ 3,553 $ - $ - $ - $ 55,306 Other consumer Substandard $ 244 $ 25 $ - $ 73 $ 16 $ 131 $ 249 $ - $ 738 Loss - - 137 - - 363 - - 500 Pass 36,144 24,238 14,942 5,618 3,433 2,753 61,796 - 148,924 Total Other consumer $ 36,388 $ 24,263 $ 15,079 $ 5,691 $ 3,449 $ 3,247 $ 62,045 $ - $ 150,162 Year-to-Date gross write-offs $ 47 $ 154 $ 125 $ 164 $ 88 $ 11,876 $ - $ - $ 12,454 Total BPPR $ 5,173,585 $ 4,388,532 $ 3,095,548 $ 1,789,039 $ 913,802 $ 6,267,828 $ 2,859,549 $ 23,040 $ 24,510,923 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total Popular U.S. Commercial: Commercial multi-family Watch $ - $ 116,794 $ 39,319 $ 71,237 $ 93,239 $ 98,365 $ - $ - $ 418,954 Special Mention - - 862 1,171 - 3,377 - - 5,410 Substandard - - - - 5,545 20,780 - - 26,325 Pass 166,410 417,169 326,047 164,887 182,528 410,836 5,112 - 1,672,989 Total commercial multi-family $ 166,410 $ 533,963 $ 366,228 $ 237,295 $ 281,312 $ 533,358 $ 5,112 $ - $ 2,123,678 Commercial real estate non-owner occupied Watch $ - $ 39,721 $ 38,713 $ 43,705 $ 39,908 $ 91,922 $ 4,557 $ - $ 258,526 Special Mention - - - - 1,327 63,365 - - 64,692 Substandard - - - 8,054 1,702 3,730 - - 13,486 Pass 396,712 490,316 170,074 201,225 86,595 394,455 6,086 - 1,745,463 Total commercial real estate non- owner occupied $ 396,712 $ 530,037 $ 208,787 $ 252,984 $ 129,532 $ 553,472 $ 10,643 $ - $ 2,082,167 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 193 $ - $ - $ 193 Commercial real estate owner occupied Watch $ - $ 69,894 $ 84,218 $ 53,066 $ 14,057 $ 98,502 $ 1,905 $ - $ 321,642 Special Mention - - 77,912 4,955 6,074 11,224 - - 100,165 Substandard - 477 2,430 - 21,763 107,675 - - 132,345 Pass 303,202 278,380 226,289 58,505 47,083 204,888 9,753 - 1,128,100 Total commercial real estate owner occupied $ 303,202 $ 348,751 $ 390,849 $ 116,526 $ 88,977 $ 422,289 $ 11,658 $ - $ 1,682,252 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 1,395 $ - $ - $ 1,395 Commercial and industrial Watch $ 198 $ 37,022 $ 47,299 $ 44,939 $ 23,493 $ 93,299 $ 32,497 $ - $ 278,747 Special Mention 208 889 1,021 30 151 39 8,674 - 11,012 Substandard 636 628 152 1,152 730 1,841 1,517 - 6,656 Pass 196,959 278,238 346,428 268,835 148,502 379,635 414,883 - 2,033,480 Total commercial and industrial $ 198,001 $ 316,777 $ 394,900 $ 314,956 $ 172,876 $ 474,814 $ 457,571 $ - $ 2,329,895 Year-to-Date gross write-offs $ 247 $ 221 $ 1,994 $ 44 $ 1,320 $ - $ 49 $ - $ 3,875 Construction Watch $ - $ 22,867 $ 12,869 $ - $ 21,896 $ 782 $ - $ - $ 58,414 Special Mention 2,120 13,151 - - - - - - 15,271 Substandard - 1 13,997 3,895 - 36,593 - - 54,486 Pass 280,188 251,627 89,450 14,733 25,254 - - - 661,252 Total construction $ 282,308 $ 287,646 $ 116,316 $ 18,628 $ 47,150 $ 37,375 $ - $ - $ 789,423 Mortgage Substandard $ - $ 235 $ - $ 646 $ 2,102 $ 8,208 $ - $ - $ 11,191 Pass 99,296 229,720 288,767 233,805 177,245 264,069 - - 1,292,902 Total mortgage $ 99,296 $ 229,955 $ 288,767 $ 234,451 $ 179,347 $ 272,277 $ - $ - $ 1,304,093 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total Popular U.S. Consumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 19 $ - $ 19 Total credit cards $ - $ - $ - $ - $ - $ - $ 19 $ - $ 19 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 1 $ - $ 1 HELOCs Substandard $ - $ - $ - $ - $ - $ 1,849 $ - $ 966 $ 2,815 Loss - - - - - 99 - 819 918 Pass - - - - - 7,394 39,925 12,253 59,572 Total HELOCs $ - $ - $ - $ - $ - $ 9,342 $ 39,925 $ 14,038 $ 63,305 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 471 $ - $ - $ 471 Personal Substandard $ 333 $ 1,630 $ 325 $ 50 $ 126 $ 211 $ - $ - $ 2,675 Loss - - - - 1 130 - - 131 Pass 41,016 93,759 23,325 2,993 3,597 1,441 - - 166,131 Total Personal $ 41,349 $ 95,389 $ 23,650 $ 3,043 $ 3,724 $ 1,782 $ - $ - $ 168,937 Year-to-Date gross write-offs $ 735 $ 13,136 $ 4,450 $ 618 $ 872 $ 160 $ - $ - $ 19,971 Other consumer Substandard $ - $ - $ - $ - $ - $ - $ 1 $ - $ 1 Pass 19 - - - - - 10,259 - 10,278 Total Other consumer $ 19 $ - $ - $ - $ - $ - $ 10,260 $ - $ 10,279 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 171 $ - $ 171 Total Popular U.S. $ 1,487,297 $ 2,342,518 $ 1,789,497 $ 1,177,883 $ 902,918 $ 2,304,709 $ 535,188 $ 14,038 $ 10,554,048 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total Popular, Inc. Commercial: Commercial multi-family Watch $ - $ 116,794 $ 39,319 $ 71,237 $ 94,307 $ 103,544 $ - $ - $ 425,201 Special Mention - 559 862 1,171 - 8,157 - - 10,749 Substandard - - - - 5,545 25,612 - - 31,157 Pass 204,386 555,788 347,381 185,374 215,082 435,084 5,418 - 1,948,513 Total commercial multi-family $ 204,386 $ 673,141 $ 387,562 $ 257,782 $ 314,934 $ 572,397 $ 5,418 $ - $ 2,415,620 Commercial real estate non-owner occupied Watch $ 1,959 $ 40,603 $ 43,918 $ 65,916 $ 45,846 $ 118,937 $ 4,557 $ - $ 321,736 Special Mention 43,020 5,413 24,730 - 17,170 131,733 - - 222,066 Substandard 1,016 1,307 180 10,285 55,431 16,698 4,069 - 88,986 Pass 701,955 1,361,507 730,859 561,078 127,857 958,249 13,128 - 4,454,633 Total commercial real estate non- owner occupied $ 747,950 $ 1,408,830 $ 799,687 $ 637,279 $ 246,304 $ 1,225,617 $ 21,754 $ - $ 5,087,421 Year-to-Date gross write-offs $ - $ - $ - $ 609 $ - $ 714 $ - $ - $ 1,323 Commercial real estate owner occupied Watch $ 2,947 $ 115,000 $ 94,131 $ 57,351 $ 19,074 $ 160,719 $ 2,905 $ - $ 452,127 Special Mention - 16,860 98,653 6,417 6,961 55,293 - - 184,184 Substandard 1,316 16,187 7,510 143,696 22,608 195,058 12,617 - 398,992 Doubtful - - - - - 136 - - 136 Pass 395,436 434,199 453,535 109,543 71,267 562,317 18,899 - 2,045,196 Total commercial real estate owner occupied $ 399,699 $ 582,246 $ 653,829 $ 317,007 $ 119,910 $ 973,523 $ 34,421 $ - $ 3,080,635 Year-to-Date gross write-offs $ - $ 4 $ - $ - $ 1 $ 5,827 $ - $ - $ 5,832 Commercial and industrial Watch $ 29,039 $ 132,807 $ 53,410 $ 48,982 $ 39,053 $ 158,659 $ 215,253 $ - $ 677,203 Special Mention 6,609 4,158 1,297 3,230 2,239 41,328 18,084 - 76,945 Substandard 1,367 2,388 8,796 23,217 2,652 33,928 42,187 - 114,535 Doubtful - - - 54 - 26 - - 80 Pass 1,306,857 912,639 858,340 510,287 271,960 638,507 1,758,768 - 6,257,358 Total commercial and industrial $ 1,343,872 $ 1,051,992 $ 921,843 $ 585,770 $ 315,904 $ 872,448 $ 2,034,292 $ - $ 7,126,121 Year-to-Date gross write-offs $ 1,143 $ 405 $ 2,209 $ 379 $ 1,875 $ 1,086 $ 4,517 $ - $ 11,614 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total Popular, Inc. Construction Watch $ - $ 39,413 $ 18,327 $ - $ 21,896 $ 782 $ 9,506 $ - $ 89,924 Special Mention 2,120 13,151 1,009 - - - 1 - 16,281 Substandard - 6,379 13,997 3,895 - 36,593 - - 60,864 Pass 306,850 276,089 116,814 25,491 27,198 1,049 38,720 - 792,211 Total construction $ 308,970 $ 335,032 $ 150,147 $ 29,386 $ 49,094 $ 38,424 $ 48,227 $ - $ 959,280 Year-to-Date gross write-offs $ - $ 2,611 $ - $ - $ - $ - $ - $ - $ 2,611 Mortgage Substandard $ 96 $ 396 $ 162 $ 991 $ 4,708 $ 80,101 $ - $ - $ 86,454 Pass 850,828 669,093 710,064 493,217 341,683 4,544,578 - - 7,609,463 Total mortgage $ 850,924 $ 669,489 $ 710,226 $ 494,208 $ 346,391 $ 4,624,679 $ - $ - $ 7,695,917 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 1,638 $ - $ - $ 1,638 Leasing Substandard $ 806 $ 2,516 $ 3,053 $ 906 $ 818 $ 517 $ - $ - $ 8,616 Loss - - - - - 17 - - 17 Pass 647,659 488,506 313,133 163,189 88,983 21,706 - - 1,723,176 Total leasing $ 648,465 $ 491,022 $ 316,186 $ 164,095 $ 89,801 $ 22,240 $ - $ - $ 1,731,809 Year-to-Date gross write-offs $ 1,065 $ 4,424 $ 2,878 $ 849 $ 976 $ 687 $ - $ - $ 10,879 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total Popular, Inc. Consumer: Credit cards Substandard $ - $ - $ - $ - $ - $ - $ 23,259 $ - $ 23,259 Loss - - - - - - 22 - 22 Pass - - - - - - 1,112,466 - 1,112,466 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,135,747 $ - $ 1,135,747 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 41,008 $ - $ 41,008 HELOCs Substandard $ - $ - $ - $ - $ - $ 1,849 $ 26 $ 966 $ 2,841 Loss - - - - - 99 - 819 918 Pass - - - - - 7,394 42,547 12,253 62,194 Total HELOCs $ - $ - $ - $ - $ - $ 9,342 $ 42,573 $ 14,038 $ 65,953 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 471 $ 213 $ - $ 684 Personal Substandard $ 2,148 $ 6,615 $ 2,264 $ 543 $ 1,059 $ 8,533 $ - $ 1,006 $ 22,168 Loss - - 14 - 13 167 - - 194 Pass 900,450 574,530 204,808 60,220 62,446 98,397 - 22,034 1,922,885 Total Personal $ 902,598 $ 581,145 $ 207,086 $ 60,763 $ 63,518 $ 107,097 $ - $ 23,040 $ 1,945,247 Year-to-Date gross write-offs $ 5,193 $ 49,051 $ 22,526 $ 4,828 $ 5,763 $ 3,112 $ - $ 1,475 $ 91,948 Auto Substandard $ 6,980 $ 14,049 $ 11,916 $ 9,157 $ 7,051 $ 3,199 $ - $ - $ 52,352 Loss 9 44 45 16 9 6 - - 129 Pass 1,210,622 899,797 711,439 405,768 260,355 120,318 - - 3,608,299 Total Auto $ 1,217,611 $ 913,890 $ 723,400 $ 414,941 $ 267,415 $ 123,523 $ - $ - $ 3,660,780 Year-to-Date gross write-offs $ 10,170 $ 23,849 $ 11,820 $ 5,914 $ 3,553 $ - $ - $ - $ 55,306 Other consumer Substandard $ 244 $ 25 $ - $ 73 $ 16 $ 131 $ 250 $ - $ 739 Loss - - 137 - - 363 - - 500 Pass 36,163 24,238 14,942 5,618 3,433 2,753 72,055 - 159,202 Total Other consumer $ 36,407 $ 24,263 $ 15,079 $ 5,691 $ 3,449 $ 3,247 $ 72,305 $ - $ 160,441 Year-to-Date gross write-offs $ 47 $ 154 $ 125 $ 164 $ 88 $ 11,876 $ 171 $ - $ 12,625 Total Popular Inc. $ 6,660,882 $ 6,731,050 $ 4,885,045 $ 2,966,922 $ 1,816,720 $ 8,572,537 $ 3,394,737 $ 37,078 $ 35,064,971 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total BPPR Commercial: Commercial multi-family Watch $ - $ - $ - $ 18,508 $ - $ 4,687 $ - $ - $ 23,195 Special Mention - - - - - 2,692 - - 2,692 Substandard - - - - - 3,326 100 - 3,426 Pass 137,411 22,850 20,821 16,145 24,640 30,193 - - 252,060 Total commercial multi-family $ 137,411 $ 22,850 $ 20,821 $ 34,653 $ 24,640 $ 40,898 $ 100 $ - $ 281,373 Commercial real estate non-owner occupied Watch $ 173 $ 36,228 $ 14,045 $ 14,942 $ 7,777 $ 99,269 $ - $ - $ 172,434 Special Mention - 4,361 19,970 7,517 - 25,540 - - 57,388 Substandard 8,933 - 3,209 19,004 25,490 21,064 - - 77,700 Pass 855,839 585,690 294,086 94,056 35,105 568,893 16,136 - 2,449,805 Total commercial real estate non- owner occupied $ 864,945 $ 626,279 $ 331,310 $ 135,519 $ 68,372 $ 714,766 $ 16,136 $ - $ 2,757,327 Commercial real estate owner occupied Watch $ 2,296 $ 5,271 $ 9,447 $ 4,275 $ 31,649 $ 71,568 $ - $ - $ 124,506 Special Mention 10 284 1,684 6,578 1,076 61,460 - - 71,092 Substandard 16,205 6,177 802 800 770 84,205 - - 108,959 Doubtful - - - - - 505 - - 505 Pass 227,404 258,473 274,333 30,691 68,029 407,322 16,742 - 1,282,994 Total commercial real estate owner occupied $ 245,915 $ 270,205 $ 286,266 $ 42,344 $ 101,524 $ 625,060 $ 16,742 $ - $ 1,588,056 Commercial and industrial Watch $ 32,376 $ 2,185 $ 15,493 $ 18,829 $ 15,483 $ 51,602 $ 56,508 $ - $ 192,476 Special Mention 2,537 2,479 5,770 1,139 6,767 46,040 6,283 - 71,015 Substandard 789 1,276 1,600 3,138 11,536 40,636 46,226 - 105,201 Doubtful - - 29 - 75 75 - - 179 Loss - - - - - - 144 - 144 Pass 793,662 684,647 211,013 177,265 65,197 292,173 1,203,536 - 3,427,493 Total commercial and industrial $ 829,364 $ 690,587 $ 233,905 $ 200,371 $ 99,058 $ 430,526 $ 1,312,697 $ - $ 3,796,508 Construction Watch $ 35,446 $ 3,116 $ 98 $ - $ - $ - $ 141 $ - $ 38,801 Substandard - - 9,629 - - - - - 9,629 Pass 13,044 34,387 15,961 2,262 - - 32,957 - 98,611 Total construction $ 48,490 $ 37,503 $ 25,688 $ 2,262 $ - $ - $ 33,098 $ - $ 147,041 Mortgage Substandard $ - $ 574 $ 687 $ 3,926 $ 4,227 $ 93,959 $ - $ - $ 103,373 Pass 449,286 451,027 285,026 204,170 237,007 4,380,390 - - 6,006,906 Total mortgage $ 449,286 $ 451,601 $ 285,713 $ 208,096 $ 241,234 $ 4,474,349 $ - $ - $ 6,110,279 Leasing Substandard $ 953 $ 1,491 $ 941 $ 1,172 $ 1,127 $ 215 $ - $ - $ 5,899 Loss - - - 21 - 21 - - 42 Pass 672,294 428,889 237,939 146,231 79,451 14,994 - - 1,579,798 Total leasing $ 673,247 $ 430,380 $ 238,880 $ 147,424 $ 80,578 $ 15,230 $ - $ - $ 1,585,739 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total BPPR Consumer: Credit cards Substandard $ - $ - $ - $ - $ - $ - $ 11,907 $ - $ 11,907 Loss - - - - - - 3 - 3 Pass - - - - - - 1,029,921 - 1,029,921 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,041,831 $ - $ 1,041,831 HELOCs Pass $ - $ - $ - $ - $ - $ - $ 2,954 $ - $ 2,954 Total HELOCs $ - $ - $ - $ - $ - $ - $ 2,954 $ - $ 2,954 Personal Substandard $ 1,330 $ 2,001 $ 764 $ 1,774 $ 503 $ 10,831 $ - $ 1,285 $ 18,488 Loss - - 53 20 31 10 - 1 115 Pass 841,564 320,809 103,337 117,568 46,555 109,543 - 27,708 1,567,084 Total Personal $ 842,894 $ 322,810 $ 104,154 $ 119,362 $ 47,089 $ 120,384 $ - $ 28,994 $ 1,585,687 Auto Substandard $ 6,764 $ 11,171 $ 10,466 $ 10,243 $ 4,597 $ 2,382 $ - $ - $ 45,623 Loss 23 41 48 25 7 14 - - 158 Pass 1,156,654 961,571 588,200 426,169 248,328 85,827 - - 3,466,749 Total Auto $ 1,163,441 $ 972,783 $ 598,714 $ 436,437 $ 252,932 $ 88,223 $ - $ - $ 3,512,530 Other consumer Substandard $ - $ - $ 100 $ 593 $ 543 $ 242 $ 10,902 $ - $ 12,380 Loss - - - - 263 40 - - 303 Pass 29,557 17,439 6,967 4,201 4,553 1,942 60,238 - 124,897 Total Other consumer $ 29,557 $ 17,439 $ 7,067 $ 4,794 $ 5,359 $ 2,224 $ 71,140 $ - $ 137,580 Total BPPR $ 5,284,550 $ 3,842,437 $ 2,132,518 $ 1,331,262 $ 920,786 $ 6,511,660 $ 2,494,698 $ 28,994 $ 22,546,905 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total Popular U.S. Commercial: Commercial multi-family Watch $ 750 $ 917 $ 6,218 $ 85,579 $ 9,633 $ 52,835 $ - $ - $ 155,932 Special Mention - - 1,198 - 14,491 8,372 - - 24,061 Substandard - - - 9,305 7,373 2,941 - - 19,619 Pass 503,010 399,397 238,903 210,295 138,723 347,615 2,785 - 1,840,728 Total commercial multi-family $ 503,760 $ 400,314 $ 246,319 $ 305,179 $ 170,220 $ 411,763 $ 2,785 $ - $ 2,040,340 Commercial real estate non-owner occupied Watch $ - $ 2,167 $ 13,622 $ 3,355 $ 26,931 $ 29,849 $ - $ - $ 75,924 Special Mention - - - 1,353 - 75,269 - - 76,622 Substandard - 2,864 2,149 3,220 1,429 4,722 - - 14,384 Pass 552,258 209,338 211,449 109,781 100,065 383,409 9,113 - 1,575,413 Total commercial real estate non- owner occupied $ 552,258 $ 214,369 $ 227,220 $ 117,709 $ 128,425 $ 493,249 $ 9,113 $ - $ 1,742,343 Commercial real estate owner occupied Watch $ - $ - $ 1,197 $ 1,079 $ 6,095 $ 55,005 $ - $ - $ 63,376 Special Mention - - 3,886 - - 901 - - 4,787 Substandard - - - 7,403 11,165 33,586 - - 52,154 Pass 363,655 422,959 114,988 82,971 119,565 258,881 7,157 - 1,370,176 Total commercial real estate owner occupied $ 363,655 $ 422,959 $ 120,071 $ 91,453 $ 136,825 $ 348,373 $ 7,157 $ - $ 1,490,493 Commercial and industrial Watch $ 12,328 $ 2,218 $ 2,022 $ 2,049 $ 8,438 $ 532 $ 4,291 $ - $ 31,878 Special Mention 1,262 1,130 314 244 60 - 3 - 3,013 Substandard 260 935 74 4,278 315 1,829 1,408 - 9,099 Loss 292 525 1 75 192 3 - - 1,088 Pass 185,318 341,855 368,398 202,301 171,528 376,045 352,169 - 1,997,614 Total commercial and industrial $ 199,460 $ 346,663 $ 370,809 $ 208,947 $ 180,533 $ 378,409 $ 357,871 $ - $ 2,042,692 Construction Watch $ - $ 12,085 $ - $ 6,979 $ 18,310 $ 34,126 $ - $ - $ 71,500 Special Mention - 3 - - - - - - 3 Substandard - - 1,423 - 6,540 2,095 - - 10,058 Pass 164,272 146,062 91,486 93,118 10,863 23,581 - - 529,382 Total construction $ 164,272 $ 158,150 $ 92,909 $ 100,097 $ 35,713 $ 59,802 $ - $ - $ 610,943 Mortgage Substandard $ - $ 2,009 $ 3,478 $ 4,048 $ 1,156 $ 9,798 $ - $ - $ 20,489 Pass 236,595 303,204 243,468 183,846 58,026 241,564 - - 1,266,703 Total mortgage $ 236,595 $ 305,213 $ 246,946 $ 187,894 $ 59,182 $ 251,362 $ - $ - $ 1,287,192 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total Popular U.S. Consumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 39 $ - $ 39 Total credit cards $ - $ - $ - $ - $ - $ - $ 39 $ - $ 39 HELOCs Substandard $ - $ - $ - $ - $ - $ 2,146 $ 20 $ 1,402 $ 3,568 Loss - - - - - 4 - 538 542 Pass - - - - - 9,169 41,724 13,959 64,852 Total HELOCs $ - $ - $ - $ - $ - $ 11,319 $ 41,744 $ 15,899 $ 68,962 Personal Substandard $ 621 $ 454 $ 149 $ 238 $ 70 $ 6 $ - $ - $ 1,538 Loss - - - - - 421 - - 421 Pass 165,153 46,320 7,339 13,443 2,021 1,657 - - 235,933 Total Personal $ 165,774 $ 46,774 $ 7,488 $ 13,681 $ 2,091 $ 2,084 $ - $ - $ 237,892 Other consumer Substandard $ - $ - $ - $ - $ - $ - $ 8 $ - $ 8 Pass - - - - - - 9,960 - 9,960 Total Other consumer $ - $ - $ - $ - $ - $ - $ 9,968 $ - $ 9,968 Total Popular U.S. $ 2,185,774 $ 1,894,442 $ 1,311,762 $ 1,024,960 $ 712,989 $ 1,956,361 $ 428,677 $ 15,899 $ 9,530,864 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total Popular, Inc. Commercial: Commercial multi-family Watch $ 750 $ 917 $ 6,218 $ 104,087 $ 9,633 $ 57,522 $ - $ - $ 179,127 Special Mention - - 1,198 - 14,491 11,064 - - 26,753 Substandard - - - 9,305 7,373 6,267 100 - 23,045 Pass 640,421 422,247 259,724 226,440 163,363 377,808 2,785 - 2,092,788 Total commercial multi-family $ 641,171 $ 423,164 $ 267,140 $ 339,832 $ 194,860 $ 452,661 $ 2,885 $ - $ 2,321,713 Commercial real estate non-owner occupied Watch $ 173 $ 38,395 $ 27,667 $ 18,297 $ 34,708 $ 129,118 $ - $ - $ 248,358 Special Mention - 4,361 19,970 8,870 - 100,809 - - 134,010 Substandard 8,933 2,864 5,358 22,224 26,919 25,786 - - 92,084 Pass 1,408,097 795,028 505,535 203,837 135,170 952,302 25,249 - 4,025,218 Total commercial real estate non- owner occupied $ 1,417,203 $ 840,648 $ 558,530 $ 253,228 $ 196,797 $ 1,208,015 $ 25,249 $ - $ 4,499,670 Commercial real estate owner occupied Watch $ 2,296 $ 5,271 $ 10,644 $ 5,354 $ 37,744 $ 126,573 $ - $ - $ 187,882 Special Mention 10 284 5,570 6,578 1,076 62,361 - - 75,879 Substandard 16,205 6,177 802 8,203 11,935 117,791 - - 161,113 Doubtful - - - - - 505 - - 505 Pass 591,059 681,432 389,321 113,662 187,594 666,203 23,899 - 2,653,170 Total commercial real estate owner occupied $ 609,570 $ 693,164 $ 406,337 $ 133,797 $ 238,349 $ 973,433 $ 23,899 $ - $ 3,078,549 Commercial and industrial Watch $ 44,704 $ 4,403 $ 17,515 $ 20,878 $ 23,921 $ 52,134 $ 60,799 $ - $ 224,354 Special Mention 3,799 3,609 6,084 1,383 6,827 46,040 6,286 - 74,028 Substandard 1,049 2,211 1,674 7,416 11,851 42,465 47,634 - 114,300 Doubtful - - 29 - 75 75 - - 179 Loss 292 525 1 75 192 3 144 - 1,232 Pass 978,980 1,026,502 579,411 379,566 236,725 668,218 1,555,705 - 5,425,107 Total commercial and industrial $ 1,028,824 $ 1,037,250 $ 604,714 $ 409,318 $ 279,591 $ 808,935 $ 1,670,568 $ - $ 5,839,200 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total Popular, Inc. Construction Watch $ 35,446 $ 15,201 $ 98 $ 6,979 $ 18,310 $ 34,126 $ 141 $ - $ 110,301 Special Mention - 3 - - - - - - 3 Substandard - - 11,052 - 6,540 2,095 - - 19,687 Pass 177,316 180,449 107,447 95,380 10,863 23,581 32,957 - 627,993 Total construction $ 212,762 $ 195,653 $ 118,597 $ 102,359 $ 35,713 $ 59,802 $ 33,098 $ - $ 757,984 Mortgage Substandard $ - $ 2,583 $ 4,165 $ 7,974 $ 5,383 $ 103,757 $ - $ - $ 123,862 Pass 685,881 754,231 528,494 388,016 295,033 4,621,954 - - 7,273,609 Total mortgage $ 685,881 $ 756,814 $ 532,659 $ 395,990 $ 300,416 $ 4,725,711 $ - $ - $ 7,397,471 Leasing Substandard $ 953 $ 1,491 $ 941 $ 1,172 $ 1,127 $ 215 $ - $ - $ 5,899 Loss - - - 21 - 21 - - 42 Pass 672,294 428,889 237,939 146,231 79,451 14,994 - - 1,579,798 Total leasing $ 673,247 $ 430,380 $ 238,880 $ 147,424 $ 80,578 $ 15,230 $ - $ - $ 1,585,739 December 31, 2022 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2022 2021 2020 2019 2018 Prior Years Total Popular, Inc. Consumer: Credit cards Substandard $ - $ - $ - $ - $ - $ - $ 11,907 $ - $ 11,907 Loss - - - - - - 3 - 3 Pass - - - - - - 1,029,960 - 1,029,960 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,041,870 $ - $ 1,041,870 HELOCs Substandard $ - $ - $ - $ - $ - $ 2,146 $ 20 $ 1,402 $ 3,568 Loss - - - - - 4 - 538 542 Pass - - - - - 9,169 44,678 13,959 67,806 Total HELOCs $ - $ - $ - $ - $ - $ 11,319 $ 44,698 $ 15,899 $ 71,916 Personal Substandard $ 1,951 $ 2,455 $ 913 $ 2,012 $ 573 $ 10,837 $ - $ 1,285 $ 20,026 Loss - - 53 20 31 431 - 1 536 Pass 1,006,717 367,129 110,676 131,011 48,576 111,200 - 27,708 1,803,017 Total Personal $ 1,008,668 $ 369,584 $ 111,642 $ 133,043 $ 49,180 $ 122,468 $ - $ 28,994 $ 1,823,579 Auto Substandard $ 6,764 $ 11,171 $ 10,466 $ 10,243 $ 4,597 $ 2,382 $ - $ - $ 45,623 Loss 23 41 48 25 7 14 - - 158 Pass 1,156,654 961,571 588,200 426,169 248,328 85,827 - - 3,466,749 Total Auto $ 1,163,441 $ 972,783 $ 598,714 $ 436,437 $ 252,932 $ 88,223 $ - $ - $ 3,512,530 Other consumer Substandard $ - $ - $ 100 $ 593 $ 543 $ 242 $ 10,910 $ - $ 12,388 Loss - - - - 263 40 - - 303 Pass 29,557 17,439 6,967 4,201 4,553 1,942 70,198 - 134,857 Total Other consumer $ 29,557 $ 17,439 $ 7,067 $ 4,794 $ 5,359 $ 2,224 $ 81,108 $ - $ 147,548 Total Popular Inc. $ 7,470,324 $ 5,736,879 $ 3,444,280 $ 2,356,222 $ 1,633,775 $ 8,468,021 $ 2,923,375 $ 44,893 $ 32,077,769

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