XML 57 R41.htm IDEA: XBRL DOCUMENT
v3.8.0.1

SEGMENT INFORMATION | 12 Months Ended
--- | ---
Dec. 31, 2017
SEGMENT INFORMATION [Text Block] | NOTE 34 – SEGMENT INFORMATION Based upon the Corporation’s organizational structure and the information provided to the Chief Executive Officer of the Corporation and, to a lesser extent, the Board of Directors, the operating segments are driven primarily by the Corporation’s lines of business for its operations in Puerto Rico, the Corporation’s principal market, and by geographic areas for its operations outside of Puerto Rico. As of December 31, 2017, the Corporation had six reportable segments: Commercial and Corporate Banking; Mortgage Banking; Consumer (Retail) Banking; Treasury and Investments; United States Operations; and Virgin Islands Operations. Management determined the reportable segments based on the internal reporting used to evaluate performance and to assess where to allocate resources. Other factors such as the Corporation’s organizational chart, nature of the products, distribution channels, and the economic characteristics of the products were also considered in the determination of the reportable segments. The Commercial and Corporate Banking segment consists of the Corporation’s lending and other services for large customers represented by specialized and middle-market clients and the public sector. The Commercial and Corporate Banking segment offers commercial loans, including commercial real estate and construction loans, and floor plan financings, as well as other products, such as cash management and business management services. The Mortgage Banking segment consists of the origination, sale, and servicing o f a variety of residential mortgage loans. The Mortgage Banking segment also acquires and sells mortgages in the secondary markets. In addition, the Mortgage Banking segment includes mortgage loans purchased from other local banks and mortgage bankers. T he Consumer (Retail) Banking segment consists of the Corporation’s consumer lending and deposit-taking activities conducted mainly through its branch network and loan centers. The Treasury and Investments segment is responsible for the Corporation’s invest ment portfolio and treasury functions that are executed to manage and enhance liquidity. This segment lends funds to the Commercial and Corporate Banking, Mortgage Banking and Consumer (Retail) Banking segments to finance their lending activities and borrows from those segments. The Consumer (Retail) Banking and the United States Operations segments also lend funds to other segments. The interest rates charged or credited by Treasury and Investments, the Consumer (Retail) Banking, and the United States Operations segments are allocated based on market rates. The difference between the allocated interest income or expense and the Corporation’s actual net interest income from centralized management of funding costs is reported in the Treasury and Investments segment. The United States Operations segment consists of all banking activities conducted by FirstBank in the United States mainland, including commercial and retail banking services. The Virgin Islands Operations segment consists of all banking activities condu cted by the Corporation in the USVI and BVI, including commercial and retail banking services. The accounting policies of the segments are the same as those referred to in Note 1 – Nature of Business and Summary of Significant Accounting Policies, to the consolidated financial statements. The Corporation evaluates the performance of the segments based on net interest income, the provision for loan and lease losses, non-interest income and direct non-interest expenses. The segments are also evaluated base d on the average volume of their interest-earning assets less the allowance for loan and lease losses.
The following table presents information about the reportable segments for the years ended December 31, 2017, 2016, and 2015:
| Mortgage Banking |  | Consumer (Retail) Banking |  | Commercial and Corporate Banking |  | Treasury and Investments |  | United States Operations |  | Virgin Islands Operations |  | Total
(In thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the year ended December 31, 2017: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income | $ | 131,718 |  | $ | 173,690 |  | $ | 128,871 |  | $ | 48,071 |  | $ | 69,760 |  | $ | 36,313 |  | $ | 588,423
Net (charge) credit for transfer of funds |  | (45,759) |  |  | 27,475 |  |  | (36,904) |  |  | 56,865 |  |  | (1,677) |  |  | - |  |  | -
Interest expense |  | - |  |  | (25,240) |  |  | - |  |  | (49,577) |  |  | (18,902) |  |  | (3,153) |  |  | (96,872)
Net interest income |  | 85,959 |  |  | 175,925 |  |  | 91,967 |  |  | 55,359 |  |  | 49,181 |  |  | 33,160 |  |  | 491,551
Provision for loan and lease losses |  | (47,713) |  |  | (53,778) |  |  | (33,296) |  |  | - |  |  | (3,644) |  |  | (5,823) |  |  | (144,254)
Non-interest income (loss) |  | 12,825 |  |  | 43,924 |  |  | 7,176 |  |  | (10,206) |  |  | 2,664 |  |  | 6,004 |  |  | 62,387
Direct non-interest expenses |  | (36,403) |  |  | (108,165) |  |  | (35,142) |  |  | (3,376) |  |  | (32,197) |  |  | (26,994) |  |  | (242,277)
Segment income | $ | 14,668 |  | $ | 57,906 |  | $ | 30,705 |  | $ | 41,777 |  | $ | 16,004 |  | $ | 6,347 |  | $ | 167,407
Average earnings assets | $ | 2,451,655 |  | $ | 1,749,148 |  | $ | 2,489,948 |  | $ | 2,215,551 |  | $ | 1,525,191 |  | $ | 603,835 |  | $ | 11,035,328
| Mortgage Banking |  | Consumer (Retail) Banking |  | Commercial and Corporate Banking |  | Treasury and Investments |  | United States Operations |  | Virgin Islands Operations |  | Total
(In thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the year ended December 31, 2016: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income | $ | 138,955 |  | $ | 179,485 |  | $ | 123,084 |  | $ | 50,372 |  | $ | 56,037 |  | $ | 37,359 |  | $ | 585,292
Net (charge) credit for transfer of funds |  | (49,435) |  |  | 13,996 |  |  | (26,364) |  |  | 60,787 |  |  | 1,016 |  |  | - |  |  | -
Interest expense |  | - |  |  | (24,787) |  |  | - |  |  | (57,924) |  |  | (15,240) |  |  | (3,223) |  |  | (101,174)
Net interest income |  | 89,520 |  |  | 168,694 |  |  | 96,720 |  |  | 53,235 |  |  | 41,813 |  |  | 34,136 |  |  | 484,118
(Provision) release for loan and lease losses |  | (24,873) |  |  | (34,246) |  |  | (28,578) |  |  | - |  |  | 1,369 |  |  | (405) |  |  | (86,733)
Non-interest income |  | 19,531 |  |  | 44,535 |  |  | 7,811 |  |  | 5,423 |  |  | 3,554 |  |  | 7,100 |  |  | 87,954
Direct non-interest expenses |  | (38,170) |  |  | (112,787) |  |  | (40,676) |  |  | (4,047) |  |  | (30,678) |  |  | (27,596) |  |  | (253,954)
Segment income | $ | 46,008 |  | $ | 66,196 |  | $ | 35,277 |  | $ | 54,611 |  | $ | 16,058 |  | $ | 13,235 |  | $ | 231,385
Average earnings assets | $ | 2,562,245 |  | $ | 1,951,214 |  | $ | 2,497,037 |  | $ | 2,616,877 |  | $ | 1,226,633 |  | $ | 612,570 |  | $ | 11,466,576
| Mortgage Banking |  | Consumer (Retail) Banking |  | Commercial and Corporate Banking |  | Treasury and Investments |  | United States Operations |  | Virgin Islands Operations |  | Total
(In thousands) |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
For the year ended December 31, 2015: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Interest income | $ | 141,820 |  | $ | 194,961 |  | $ | 133,067 |  | $ | 49,534 |  | $ | 46,804 |  | $ | 39,383 |  | $ | 605,569
Net (charge) credit for transfer of funds |  | (49,149) |  |  | 17,260 |  |  | (17,299) |  |  | 36,908 |  |  | 12,280 |  |  | - |  |  | -
Interest expense |  | - |  |  | (23,774) |  |  | - |  |  | (60,221) |  |  | (16,192) |  |  | (3,116) |  |  | (103,303)
Net interest income |  | 92,671 |  |  | 188,447 |  |  | 115,768 |  |  | 26,221 |  |  | 42,892 |  |  | 36,267 |  |  | 502,266
(Provision) release for loan and lease losses |  | (30,017) |  |  | (46,657) |  |  | (101,604) |  |  | - |  |  | 7,955 |  |  | (1,722) |  |  | (172,045)
Non-interest income (loss) |  | 16,027 |  |  | 41,854 |  |  | 12,487 |  |  | (15,897) |  |  | 2,795 |  |  | 10,616 |  |  | 67,882
Direct non-interest expenses |  | (37,345) |  |  | (133,397) |  |  | (42,470) |  |  | (3,840) |  |  | (28,674) |  |  | (34,231) |  |  | (279,957)
Segment income (loss) | $ | 41,336 |  | $ | 50,247 |  | $ | (15,819) |  | $ | 6,484 |  | $ | 24,968 |  | $ | 10,930 |  | $ | 118,146
Average earnings assets | $ | 2,607,230 |  | $ | 1,951,047 |  | $ | 2,891,988 |  | $ | 2,740,120 |  | $ | 1,024,939 |  | $ | 646,966 |  | $ | 11,862,290
| The following table presents a reconciliation of the reportable segment financial information to the consolidated totals:
|  | Year Ended December 31,
|  | 2017 |  | 2016 |  | 2015
| (In thousands) |  |  |  |  |  |  |  |
| Net income: |  |  |  |  |  |  |  |
| Total income for segments and other | $ | 167,407 |  | $ | 231,385 |  | $ | 118,146
| Other non-interest income (1) |  | - |  |  | - |  |  | 13,443
| Other operating expenses (2) |  | (105,424) |  |  | (101,126) |  |  | (103,873)
| Income before income taxes |  | 61,983 |  |  | 130,259 |  |  | 27,716
| Income tax benefit (expense) |  | 4,973 |  |  | (37,030) |  |  | (6,419)
| Total consolidated net income | $ | 66,956 |  | $ | 93,229 |  | $ | 21,297
| Average assets: |  |  |  |  |  |  |  |
| Total average earning assets for segments | $ | 11,035,328 |  | $ | 11,466,576 |  | $ | 11,862,290
| Average non-earning assets |  | 937,950 |  |  | 923,566 |  |  | 919,263
| Total consolidated average assets | $ | 11,973,278 |  | $ | 12,390,142 |  | $ | 12,781,553
(1) | The bargain purchase gain on the acquisition of assets and assumption of deposits from Doral Bank in 2015 is presented as Other non-interest income in the table above.
(2) | Expenses pertaining to corporate administrative functions that support the operating segments but are not specifically attributable to or managed by any segment are not included in the reported financial results of the operating segments. The unallocated corporate expenses include certain general and administrative expenses and related depreciation and amortization expenses.
| The following table presents revenues (interest income plus non-interest income) and selected balance sheet data by geography based on the location in which the transaction is originated:
|  | 2017 |  | 2016 |  | 2015
| (In thousands) |  |  |  |  |  |  |  |
| Revenues: |  |  |  |  |  |  |  |
| Puerto Rico | $ | 536,069 |  | $ | 568,180 |  | $ | 575,016
| United States |  | 72,424 |  |  | 60,607 |  |  | 61,879
| Virgin Islands |  | 42,317 |  |  | 44,459 |  |  | 49,999
| Total consolidated revenues | $ | 650,810 |  | $ | 673,246 |  | $ | 686,894
| Selected Balance Sheet Information: |  |  |  |  |  |  |  |
| Total assets: |  |  |  |  |  |  |  |
| Puerto Rico | $ | 9,871,272 |  | $ | 9,765,530 |  | $ | 10,648,179
| United States |  | 1,780,654 |  |  | 1,499,548 |  |  | 1,202,318
| Virgin Islands |  | 609,342 |  |  | 657,377 |  |  | 722,522
| Loans: |  |  |  |  |  |  |  |
| Puerto Rico | $ | 6,633,432 |  | $ | 6,926,719 |  | $ | 7,332,274
| United States |  | 1,665,448 |  |  | 1,382,440 |  |  | 1,125,501
| Virgin Islands |  | 584,576 |  |  | 627,720 |  |  | 690,476
| Deposits: |  |  |  |  |  |  |  |
| Puerto Rico (1) | $ | 6,268,056 |  | $ | 6,291,353 |  | $ | 6,747,638
| United States (2) |  | 1,637,941 |  |  | 1,564,839 |  |  | 1,606,723
| Virgin Islands |  | 1,116,634 |  |  | 975,013 |  |  | 983,763
(1) | For 2017, 2016, and 2015, includes $1.0 billion, $1.4 billion, and $2.1 billion, respectively, of brokered CDs allocated to Puerto Rico operations.
(2) | For 2017 and 2016 includes $158.0 million and $60.1 million, respectively, of brokered CDs allocated to the United States operations.

X
- 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/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
Name: | us-gaap_SegmentReportingDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration