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Stock-based compensation | 6 Months Ended
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Jun. 30, 2025
Disclosure of compensation related costs sharebased payments [Abstract] |
Stock-based Compensation | Note 29 - Stock-based compensation Incentive Plan On May 12, 2020, the stockholders of the Corporation approved the Popular, Inc. 2020 Omnibus Incentive Plan, which permits the Corporation to issue several types of stock-based compensation to employees and directors of the Corporation and/or any of its subsidiaries (the “2020 Incentive Plan”). The 2020 Incentive Plan replaced the Popular, Inc. 2004 Omnibus Incentive Plan, which was in effect prior to the adoption of the 2020 Incentive Plan (the “2004 Incentive Plan” and, together with the 2020 Incentive Plan, the “Incentive Plan”). Participants under the Incentive Plan are designated by the Talent and Compensation Committee of the Board of Directors (or its delegate, as determined by the Board). Under the Incentive Plan, the Corporation has issued restricted stock and performance shares to its employees and restricted stock and restricted stock units (“RSUs”) to its directors. The restricted stock granted under the Incentive Plan to employees becomes vested based on the employees’ continued service with Popular. Unless otherwise stated in an agreement, the compensation cost associated with the shares of restricted stock granted prior to 2021 was determined based on a two-prong vesting schedule. These grants include ratable vesting over five or four years commencing at the date of grant (“the graduated vesting portion”) with a portion vested at termination of employment after attainment of 55 years of age and 10 years of service or 60 years of age and 5 years of service (“the retirement vesting portion”). The graduated vesting portion is accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service. Restricted stock granted on or after 2021 have ratable vesting in equal annual installments over a period of 4 years or 3 years, depending on the classification of the employee. The vesting schedule is accelerated at termination of employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service. The performance share awards granted under the Incentive Plan consist of the opportunity to receive shares of Popular, Inc.’s common stock provided that the Corporation achieves certain goals during a three-year performance cycle. The goals will be based on two metrics weighted equally: the Relative Total Shareholder Return (“TSR”) and the Absolute Return on Average Tangible Common Equity (“ROATCE”). The TSR metric is a market condition under ASC 718. For equity settled awards based on market conditions, the fair value is determined as of the grant date and is not subsequently revised based on actual performance. The ROATCE metric is a performance condition under ASC 718. The fair value is determined based on the probability of achieving the ROATCE goal as of each reporting period. The TSR and ROATCE metrics are equally weighted and work independently. The number of shares that will ultimately vest ranges from 50% to a 150% target based on both market (TSR) and performance (ROATCE) conditions. The performance shares will vest at the end of the three-year performance cycle. If a participant terminates employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service, the performance shares shall continue outstanding and vest at the end of the performance cycle. The following table summarizes the restricted stock and performance shares activity under the Incentive Plan for members of management. (Not in thousands) Shares Weighted-Average Grant Date Fair Value Non-vested at December 31, 2023 299,896 $ 58.20 Granted 242,474 86.62 Performance Shares Quantity Adjustment (18,650) 87.79 Vested (267,873) 74.26 Forfeited (7,939) 50.68 Non-vested at December 31, 2024 247,908 $ 66.86 Granted 241,762 100.67 Performance Shares Quantity Adjustment 48,923 92.33 Vested (277,721) 90.69 Forfeited (5,515) 60.68 Non-vested at June 30, 2025 255,357 $ 77.90 During the quarter ended June 30, 2025, 121,649 shares of restricted stock (June 30, 2024 – 97,732 ) were awarded to management under the Incentive Plan. During the quarters ended June 30, 2025 and 2024, no performance shares were awarded to management under the Incentive Plan. During the six months ended June 30, 2025, 194,268 shares of restricted stock (June 30, 2024 – 175,591 ) and 47,494 performance shares (June 30, 2024 - 65,225 ) were awarded to management under the Incentive Plan. During the quarter ended June 30, 2025, the Corporation recognized $ 6.9 million of restricted stock expense related to management incentive awards, with a tax benefit of $ 1.0 million (June 30, 2024 - $ 4.1 million, with a tax benefit of $ 1.0 million). For the six months ended June 30, 2025, the Corporation recognized $ 14.4 million of restricted stock expense related to management incentive awards, with a tax benefit of $ 1.6 million (June 30, 2024 - $ 10.5 million, with a tax benefit of $ 1.7 million). For the six months ended June 30, 2025, the fair market value of the restricted stock and performance shares vested was $ 20.0 million on the grant date and $ 27.4 million at vesting date. This differential triggers a windfall of $ 2.7 million that was recorded as a reduction on income tax expense. During the quarter ended June 30, 2025, the Corporation recognized $ 0.8 million of performance shares expense, with a tax benefit of $ 61 thousand due to performance shares target adjustment (June 30, 2024 - $ (0.9) million, with a tax benefit of $ (55) thousand). For the six months ended June 30, 2025, the Corporation recognized $ 4.2 million of performance shares expense, with a tax benefit of $ 0.5 million (June 30, 2024 - $ 4.1 million, with a tax benefit of $ 0.3 million). The total unrecognized compensation cost related to non-vested restricted stock awards and performance shares to members of management at June 30, 2025 was $ 17.6 million and is expected to be recognized over a weighted-average period of 1.65 years. The following table summarizes the restricted stock activity under the Incentive Plan for members of the Board of Directors: (Not in thousands) RSUs / Restricted stock Weighted-Average Grant Date Fair Value per Unit Non-vested at December 31, 2023 - $ - Granted 25,462 89.51 Vested (25,462) 89.51 Forfeited - - Non-vested at December 31, 2024 - $ - Granted 22,050 99.42 Vested (2,937) 92.45 Forfeited - - Non-vested at June 30, 2025 19,113 $ 99.42 The equity awards granted to members of the Board of Directors of Popular, Inc. (the “Directors”) after May 2025 will vest and become non-forfeitable on the first anniversary of the grant date of such award. Equity awards granted to the Directors may be paid in either common stock or RSUs, at each Director’s election. If RSUs are elected, the Directors may defer the delivery of the shares of common stock underlying the RSUs award until their retirement. To the extent that cash dividends are paid on the Corporation’s outstanding common stock, the Directors will receive an additional number of RSUs that reflect a reinvested dividend equivalent. During the quarter ended June 30, 2025, 17,816 RSUs and 2,688 shares of restricted stock were granted to the Directors (June 30, 2024 - 20,411 RSUs and 1,392 shares of unrestricted stock) and the Corporation recognized $ 0.4 million of expense related to these shares with a tax benefit of $ 84 thousand (June 30, 2024 - $ 1.9 million with a tax benefit of $ 0.4 million). For the six months ended June 30, 2025, the Corporation granted 19,362 RSUs and 2,688 shares of restricted stock to the Directors (June 30, 2024 - 21,606 RSUs and 1,392 shares of unrestricted stock) and the Corporation recognized $ 0.7 million of expense related to these shares, with a tax benefit of $ 0.1 million, (June 30, 2024 - $ 2.1 million, with a tax benefit of $ 0.4 million). The fair value at vesting date of the RSUs vested during the six months ended June 30, 2025 for the Directors was $ 2.2 million.

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