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LOANS HELD FOR INVESTMENT
 9 Months Ended
Sep. 30, 2022
Receivables [Abstract]  
LOAN HELD FOR INVESTMENT [Text Block]
NOTE 3 – LOANS HELD FOR INVESTMENT
 
The
 
following table
 
provides information
 
about the
 
loan
 
portfolio held
 
for
 
investment by
 
portfolio segment
 
and
 
disaggregated by
geographic location
 
as of the indicated
 
dates:
As of September 30, 2022
As of December 31, 2021
(In thousands)
Puerto Rico and Virgin Island region:
Residential mortgage loans, mainly secured by first mortgages
$
2,415,232
$
2,549,573
Construction loans
27,716
43,133
Commercial mortgage loans
 
1,754,447
1,702,231
Commercial and Industrial ("C&I") loans
1,842,166
1,946,597
Consumer loans
3,208,437
2,872,384
Loans held for investment
9,247,998
9,113,918
Florida region:
Residential mortgage loans, mainly secured by first mortgages
$
415,742
$
429,322
Construction loans
96,278
95,866
Commercial mortgage loans
 
511,167
465,238
C&I loans
1,016,120
940,654
Consumer loans
11,313
15,660
Loans held for investment
2,050,620
1,946,740
Total:
Residential mortgage loans, mainly secured by first mortgages
$
2,830,974
$
2,978,895
Construction loans
123,994
138,999
Commercial mortgage loans
 
2,265,614
2,167,469
C&I loans
(1)
2,858,286
2,887,251
Consumer loans
3,219,750
2,888,044
Loans held for investment
(2)
$
11,298,618
$
11,060,658
(1)
As of September 30, 2022 and December 31, 2021, includes
 
$
870.3
 
million and $
952.1
 
million, respectively, of commercial loans that were secured by real estate
but were not dependent upon the real estate for repayment.
(2)
Includes accretable fair value net purchase discounts of $
30.7
 
million and $
35.3
 
million as of September 30, 2022 and December 31, 2021,
 
respectively.
The
 
Corporation’s
 
aging
 
of
 
the
 
loan
 
portfolio
 
held
 
for
 
investment
 
by
 
portfolio
 
classes
 
and
 
nonaccrual
 
loans
 
with
 
no
 
ACL
 
as
 
of
September 30, 2022 and December 31, 2021 are as follows:
As of September 30, 2022
Days Past Due and Accruing
Current
30-59
60-89
90 +
(1) (2) (3)
Nonaccrual
(4) (5)
Total loans
held for
investment
Nonaccrual
Loans with
no ACL
(6)
(In thousands)
Residential mortgage loans, mainly secured by first mortgages:
FHA/VA government-guaranteed loans
(1)
(3) (7)
$
67,095
$
-
$
2,824
$
49,044
$
-
$
118,963
$
-
Conventional residential mortgage loans
(2) (7)
2,621,897
-
29,012
18,066
43,036
2,712,011
3,412
Commercial loans:
Construction loans
121,757
-
-
-
2,237
123,994
976
Commercial mortgage loans
(2) (7)
2,238,580
1,415
417
1,461
23,741
2,265,614
15,699
 
C&I loans
2,827,076
4,463
1,943
9,089
15,715
2,858,286
10,854
Consumer loans:
Auto loans
1,695,594
41,935
8,068
-
8,703
1,754,300
2,054
Finance leases
659,097
7,033
1,554
-
1,430
669,114
216
Personal loans
341,220
3,852
1,884
-
1,146
348,102
-
Credit cards
293,555
4,212
2,320
3,985
-
304,072
-
Other consumer loans
139,621
1,779
1,254
-
1,508
144,162
-
Total loans held for investment
$
11,005,492
$
64,689
$
49,276
$
81,645
$
97,516
$
11,298,618
$
33,211
(1)
It is the Corporation's policy to report delinquent FHA/VA
 
government-guaranteed residential mortgage loans
 
as past-due loans 90 days and still accruing as opposed
 
to nonaccrual
loans. The Corporation continues accruing interest on these
 
loans until they have passed the 15 months delinquency mark, taking
 
into consideration the FHA interest curtailment process.
These balances include $
31.0
 
million of residential mortgage loans guaranteed by the FHA that were
 
over 15 months delinquent.
(2)
Includes purchased credit deteriorated ("PCD") loans previously accounted
 
for under Accounting Standard Codification ("ASC") Subtopic
 
310-30, "Loans and Debt Securities Acquired
with Deteriorated Credit Quality" ("ASC Subtopic 310-30") for
 
which the Corporation made the accounting policy election of maintaining
 
pools of loans as “units of account” both at the
time of adoption of CECL on January 1, 2020 and on an
 
ongoing basis for credit loss measurement. These loans
 
will continue to be excluded from nonaccrual loan statistics
 
as long as
the Corporation can reasonably estimate the timing and amount
 
of cash flows expected to be collected on the loan
 
pools. The portion of such loans contractually past due 90
 
days or
more, amounting to $
12.8
 
million as of September 30, 2022 ($
11.8
 
million conventional residential mortgage loans and $
1.0
 
million commercial mortgage loans), is presented in the
loans past due 90 days or more and still accruing category in
 
the table above.
(3)
Include rebooked loans, which were previously pooled into
 
GNMA securities, amounting to $
8.0
 
million as of September 30, 2022. Under the GNMA program, the
 
Corporation has the
option but not the obligation to repurchase loans that meet GNMA’s
 
specified delinquency criteria. For accounting purposes,
 
these loans subject to the repurchase option are required to
be reflected on the financial statements with an offsetting liability.
(4)
Nonaccrual loans in the Florida region amounted to $
6.5
 
million as of September 30, 2022, primarily nonaccrual residential
 
mortgage loans.
(5)
Nonaccrual loans exclude $
340.1
 
million of TDR loans that were in compliance with modified terms
 
and in accrual status as of September 30, 2022.
(6)
Includes $
0.6
 
million of nonaccrual C&I loans with no ACL in the Florida region
 
as of September 30, 2022.
(7)
According to the Corporation's delinquency policy and consistent
 
with the instructions for the preparation of the Consolidated
 
Financial Statements for Bank Holding Companies (FR Y-
9C) required by the Federal Reserve Board, residential mortgage,
 
commercial mortgage, and construction loans are considered past
 
due when the borrower is in arrears on two or more
monthly payments. FHA/VA
 
government-guaranteed loans, conventional residential mortgage loans,
 
and commercial mortgage loans past due 30-59 days,
 
but less than two payments in
arrears, as of September 30, 2022 amounted to $
6.0
 
million, $
71.7
 
million, and $
1.9
 
million, respectively.
As of December 31, 2021
Days Past Due and Accruing
Current
30-59
60-89
90+
 
(1) (2) (3)
Nonaccrual
(4) (5)
Total loans
held for
investment
Nonaccrual
Loans with
no ACL
(6)
(In thousands)
Residential mortgage loans, mainly secured by first mortgages:
FHA/VA government-guaranteed loans
(1) (3) (7)
$
57,522
$
-
$
2,355
$
65,515
$
-
$
125,392
$
-
Conventional residential mortgage loans
(2) (7)
2,738,111
-
31,832
28,433
55,127
2,853,503
3,689
Commercial loans:
Construction loans
136,317
18
-
-
2,664
138,999
1,000
Commercial mortgage loans
(2) (7)
2,129,375
2,402
436
9,919
25,337
2,167,469
8,289
C&I loans
2,858,397
2,047
1,845
7,827
17,135
2,887,251
11,393
Consumer loans:
Auto loans
1,533,445
26,462
4,949
-
6,684
1,571,540
3,146
Finance leases
568,606
4,820
713
-
866
575,005
196
Personal loans
310,390
3,299
1,285
-
1,208
316,182
-
Credit cards
282,179
3,158
1,904
2,985
-
290,226
-
Other consumer loans
130,588
1,996
811
-
1,696
135,091
20
Total loans held for investment
$
10,744,930
$
44,202
$
46,130
$
114,679
$
110,717
$
11,060,658
$
27,733
 
(1)
It is the Corporation's policy to report delinquent FHA/VA
 
government-guaranteed residential mortgage loans
 
as past-due loans 90 days and still accruing as opposed
 
to nonaccrual loans.
The Corporation continues accruing interest on these loans
 
until they have passed the 15 months delinquency mark, taking into consideration
 
the FHA interest curtailment process. These
balances include $
46.6
 
million of residential mortgage loans guaranteed by the FHA that
 
were over 15 months delinquent.
(2)
Includes PCD loans previously accounted for under ASC Subtopic 310-30
 
for which the Corporation made the accounting policy
 
election of maintaining pools of loans as “units of account”
both at the time of adoption of CECL on January 1, 2020 and on
 
an ongoing basis for credit loss measurement. These
 
loans will continue to be excluded from nonaccrual loan statistics
 
as
long as the Corporation can reasonably estimate the timing and
 
amount of cash flows expected to be collected on the
 
loan pools. The portion of such loans contractually past
 
due 90 days or
more, amounting to $
20.6
 
million as of December 31, 2021 ($
19.1
 
million conventional residential mortgage loans and $
1.5
 
million commercial mortgage loans), is presented in the loans
past due 90 days or more and still accruing category in the table
 
above.
(3)
Include rebooked loans, which were previously pooled into
 
GNMA securities, amounting to $
7.2
 
million as of December 31, 2021. Under the GNMA program,
 
the Corporation has the
option but not the obligation to repurchase loans that meet GNMA’s
 
specified delinquency criteria. For accounting purposes,
 
these loans subject to the repurchase option are required to be
reflected on the financial statements with an offsetting liability.
(4)
Nonaccrual loans in the Florida region amounted to $
8.2
 
million as of December 31, 2021, primarily nonaccrual residential mortgage
 
loans.
(5)
Nonaccrual loans exclude $
363.4
 
million of TDR loans that were in compliance with modified terms
 
and in accrual status as of December 31, 2021.
(6)
Includes $
0.5
 
million of nonaccrual C&I loans with no ACL in the Florida region
 
as of December 31, 2021.
(7)
According to the Corporation's delinquency policy and consistent
 
with the instructions for the preparation of the Consolidated
 
Financial Statements for Bank Holding Companies (FR Y-9C)
required by the Federal Reserve Board, residential mortgage,
 
commercial mortgage, and construction loans are considered past
 
due when the borrower is in arrears on two or more monthly
payments.
 
FHA/VA government
 
-guaranteed loans, conventional residential mortgage
 
loans, and commercial mortgage loans past due 30-59 days,
 
but less than two payments in arrears, as
of December 31, 2021 amounted to $
6.1
 
million, $
66.0
 
million, and $
0.7
 
million, respectively.
When a
 
loan
 
is placed
 
on nonaccrual
 
status, any
 
accrued but
 
uncollected
 
interest income
 
is reversed
 
and
 
charged
 
against interest
income
 
and the
 
amortization of
 
any net
 
deferred fees
 
is suspended.
 
The amount
 
of accrued
 
interest reversed
 
against interest
 
income
totaled $
0.5
 
million and $
1.2
 
million for the
 
quarter and nine-month
 
period ended September
 
30, 2022, respectively
 
($
0.4
 
million and
$
1.7
 
million for
 
the quarter
 
and nine-month
 
period ended
 
September 30,
 
2021, respectively).
 
For the
 
quarter and
 
nine-month
 
period
ended September
 
30, 2022, the
 
cash interest recognized
 
on nonaccrual
 
loans amounted
 
to $
0.3
 
million and
 
$
1.0
 
million, respectively,
compared with $
0.4
 
million and $
1.7
 
million for the quarter and nine-month period ended September 30, 2021, respectively.
As of
 
September 30,
 
2022, the
 
recorded investment
 
on residential
 
mortgage loans
 
collateralized by
 
residential real
 
estate property
that
 
were
 
in
 
the
 
process
 
of
 
foreclosure
 
amounted
 
to
 
$
76.1
 
million,
 
including
 
$
32.6
 
million
 
of
 
FHA/VA
 
government-guaranteed
mortgage
 
loans,
 
and
 
$
10.0
 
million
 
of
 
PCD
 
loans
 
acquired
 
prior
 
to
 
the
 
adoption,
 
on
 
January
 
1,
 
2020,
 
of
 
CECL.
The
 
Corporation
commences the foreclosure
 
process on residential
 
real estate loans when
 
a borrower becomes
120
 
days delinquent, in accordance
 
with
the
 
requirements
 
of
 
the
 
Consumer
 
Financial
 
Protection
 
Bureau
 
(“CFPB”).
 
Foreclosure
 
procedures
 
and
 
timelines
 
vary
 
depending
 
on
whether
 
the
 
property
 
is
 
located
 
in
 
a
 
judicial
 
or
 
non-judicial
 
state.
 
Occasionally,
 
foreclosures
 
may
 
be
 
delayed
 
due
 
to,
 
among
 
other
reasons, mandatory mediations, bankruptcy,
 
court delays and title issues.
Credit Quality Indicators:
The Corporation
 
categorizes loans
 
into risk
 
categories based
 
on relevant
 
information
 
about the
 
ability of
 
the borrowers
 
to service
their debt
 
such as
 
current financial
 
information, historical
 
payment experience,
 
credit documentation,
 
public information,
 
and current
economic trends, among other
 
factors.
 
The Corporation analyzes non-homogeneous
 
loans, such as commercial mortgage,
 
commercial
and industrial,
 
and construction
 
loans individually
 
to classify the
 
loans’ credit risk.
 
As mentioned above,
 
the Corporation periodically
reviews its
 
commercial and
 
construction loans
 
to evaluate
 
if they
 
are properly
 
classified. The frequency
 
of these
 
reviews will depend
on the
 
amount of
 
the aggregate
 
outstanding debt,
 
and the
 
risk rating
 
classification of
 
the obligor.
 
In addition,
 
during the
 
renewal and
annual review
 
process of
 
applicable credit
 
facilities, the
 
Corporation evaluates
 
the corresponding
 
loan grades.
 
The Corporation
 
uses
the
 
same
 
definition
 
for
 
risk
 
ratings
 
as
 
those
 
described
 
for
 
Puerto
 
Rico
 
municipal
 
bonds
 
accounted
 
for
 
as
 
held-to-maturity
 
debt
securities, as discussed in Note 5 – Investment Securities, in the 2021
 
Annual Report on Form 10-K.
For residential mortgage and consumer loans, the Corporation also evaluates credit
 
quality based on its interest accrual status.
 
Based on
 
the most
 
recent analysis
 
performed, the
 
amortized cost
 
of commercial
 
and construction
 
loans by portfolio
 
classes and by
origination
 
year
 
based
 
on
 
the
 
internal
 
credit-risk
 
category
 
as
 
of
 
September
 
30,
 
2022
 
and
 
the
 
amortized
 
cost
 
of
 
commercial
 
and
construction loans by portfolio classes based on the internal credit-risk
 
category as of December 31, 2021 was as follows:
As of September 30, 2022
Puerto Rico and Virgin Islands region
Term Loans
As of December 31, 2021
Amortized Cost Basis by Origination Year
(1)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
(In thousands)
CONSTRUCTION
Risk Ratings:
Pass
$
8,853
$
11,978
$
-
$
-
$
-
$
3,958
$
-
$
24,789
$
38,066
Criticized:
Special Mention
-
-
-
-
-
-
-
-
765
Substandard
-
-
-
-
-
2,927
-
2,927
4,302
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total construction loans
$
8,853
$
11,978
$
-
$
-
$
-
$
6,885
$
-
$
27,716
$
43,133
COMMERCIAL MORTGAGE
Risk Ratings:
Pass
$
241,870
$
150,940
$
365,144
$
222,211
$
179,280
$
308,966
$
232
$
1,468,643
$
1,395,569
Criticized:
Special Mention
1,218
-
3,611
83,664
30,832
130,324
-
249,649
259,263
Substandard
138
-
-
2,927
761
32,329
-
36,155
47,399
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total commercial mortgage loans
$
243,226
$
150,940
$
368,755
$
308,802
$
210,873
$
471,619
$
232
$
1,754,447
$
1,702,231
COMMERCIAL AND INDUSTRIAL
Risk Ratings:
Pass
$
116,025
$
200,628
$
189,639
$
324,443
$
126,946
$
258,087
$
541,962
$
1,757,730
$
1,852,552
Criticized:
Special Mention
145
-
-
-
236
2,652
24,830
27,863
32,650
Substandard
65
4,093
1,360
14,113
1,958
33,310
1,674
56,573
61,395
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total commercial and industrial loans
$
116,235
$
204,721
$
190,999
$
338,556
$
129,140
$
294,049
$
568,466
$
1,842,166
$
1,946,597
(1) Excludes accrued interest receivable.
As of September 30, 2022
Term Loans
As of December 31, 2021
Florida region
Amortized Cost Basis by Origination Year
(1)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
(In thousands)
CONSTRUCTION
Risk Ratings:
Pass
$
46,944
$
45,284
$
-
$
14
$
-
$
-
$
4,036
$
96,278
$
95,866
Criticized:
Special Mention
-
-
-
-
-
-
-
-
-
Substandard
-
-
-
-
-
-
-
-
-
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total construction loans
$
46,944
$
45,284
$
-
$
14
$
-
$
-
$
4,036
$
96,278
$
95,866
COMMERCIAL MORTGAGE
Risk Ratings:
Pass
$
157,109
$
70,922
$
42,997
$
55,184
$
72,273
$
71,565
$
19,232
$
489,282
$
404,304
Criticized:
Special Mention
-
-
7,024
13,384
-
-
-
20,408
60,618
Substandard
-
-
1,168
-
-
309
-
1,477
316
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total commercial mortgage loans
$
157,109
$
70,922
$
51,189
$
68,568
$
72,273
$
71,874
$
19,232
$
511,167
$
465,238
COMMERCIAL AND INDUSTRIAL
Risk Ratings:
Pass
$
255,508
$
169,329
$
82,074
$
224,772
$
67,508
$
45,828
$
96,639
$
941,658
$
826,823
Criticized:
Special Mention
-
-
-
5,972
-
12,185
-
18,157
49,946
Substandard
-
-
24,193
27,456
-
4,356
300
56,305
63,885
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total commercial and industrial loans
$
255,508
$
169,329
$
106,267
$
258,200
$
67,508
$
62,369
$
96,939
$
1,016,120
$
940,654
(1) Excludes accrued interest receivable.
As of September 30, 2022
Total
Term Loans
As of December 31, 2021
Amortized Cost Basis by Origination Year
(1)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
(In thousands)
CONSTRUCTION
Risk Ratings:
Pass
$
55,797
$
57,262
$
-
$
14
$
-
$
3,958
$
4,036
$
121,067
$
133,932
Criticized:
Special Mention
-
-
-
-
-
-
-
-
765
Substandard
-
-
-
-
-
2,927
-
2,927
4,302
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total construction loans
$
55,797
$
57,262
$
-
$
14
$
-
$
6,885
$
4,036
$
123,994
$
138,999
COMMERCIAL MORTGAGE
Risk Ratings:
Pass
$
398,979
$
221,862
$
408,141
$
277,395
$
251,553
$
380,531
$
19,464
$
1,957,925
$
1,799,873
Criticized:
Special Mention
1,218
-
10,635
97,048
30,832
130,324
-
270,057
319,881
Substandard
138
-
1,168
2,927
761
32,638
-
37,632
47,715
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total commercial mortgage loans
$
400,335
$
221,862
$
419,944
$
377,370
$
283,146
$
543,493
$
19,464
$
2,265,614
$
2,167,469
COMMERCIAL AND INDUSTRIAL
Risk Ratings:
Pass
$
371,533
$
369,957
$
271,713
$
549,215
$
194,454
$
303,915
$
638,601
$
2,699,388
$
2,679,375
Criticized:
Special Mention
145
-
-
5,972
236
14,837
24,830
46,020
82,596
Substandard
65
4,093
25,553
41,569
1,958
37,666
1,974
112,878
125,280
Doubtful
-
-
-
-
-
-
-
-
-
Loss
-
-
-
-
-
-
-
-
-
Total commercial and industrial loans
$
371,743
$
374,050
$
297,266
$
596,756
$
196,648
$
356,418
$
665,405
$
2,858,286
$
2,887,251
(1) Excludes accrued interest receivable.
The
 
following
 
tables
 
present
 
the
 
amortized
 
cost
 
of
 
residential
 
mortgage
 
loans
 
by
 
origination
 
year
 
based
 
on
 
accrual
 
status
 
as
 
of
September 30, 2022, and the amortized cost of residential mortgage loans by
 
accrual status as of December 31, 2021:
As of September 30, 2022
As of
December 31,
2021
Term Loans
Amortized Cost Basis by Origination Year
(1)
(In thousands)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
Puerto Rico and Virgin Islands Region:
FHA/VA government-guaranteed loans
Accrual Status:
Performing
$
705
$
323
$
828
$
1,291
$
3,871
$
111,199
$
-
$
118,217
$
124,652
Non-Performing
-
-
-
-
-
-
-
-
-
Total FHA/VA
 
government-guaranteed loans
$
705
$
323
$
828
$
1,291
$
3,871
$
111,199
$
-
$
118,217
$
124,652
Conventional residential mortgage loans:
Accrual Status:
Performing
$
113,963
$
77,357
$
32,059
$
49,797
$
73,631
$
1,912,690
$
-
$
2,259,497
$
2,376,946
Non-Performing
-
35
-
113
279
37,091
-
37,518
47,975
Total conventional residential mortgage loans
$
113,963
$
77,392
$
32,059
$
49,910
$
73,910
$
1,949,781
$
-
$
2,297,015
$
2,424,921
Total:
Accrual Status:
Performing
$
114,668
$
77,680
$
32,887
$
51,088
$
77,502
$
2,023,889
$
-
$
2,377,714
$
2,501,598
Non-Performing
-
35
-
113
279
37,091
-
37,518
47,975
Total residential mortgage loans in Puerto Rico
and Virgin Islands Region
$
114,668
$
77,715
$
32,887
$
51,201
$
77,781
$
2,060,980
$
-
$
2,415,232
$
2,549,573
(1)
Excludes accrued interest receivable.
As of September 30, 2022
As of
December 31,
2021
Term Loans
Amortized Cost Basis by Origination Year
(1)
(In thousands)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
Florida Region:
FHA/VA government-guaranteed loans
Accrual Status:
Performing
$
-
$
-
$
-
$
-
$
-
$
746
$
-
$
746
$
740
Non-Performing
-
-
-
-
-
-
-
-
-
Total FHA/VA
 
government-guaranteed loans
$
-
$
-
$
-
$
-
$
-
$
746
$
-
$
746
$
740
Conventional residential mortgage loans:
Accrual Status:
Performing
$
58,261
$
50,307
$
32,160
$
33,150
$
38,744
$
196,856
$
-
$
409,478
$
421,430
Non-Performing
-
-
-
274
-
5,244
-
5,518
7,152
Total conventional residential mortgage loans
$
58,261
$
50,307
$
32,160
$
33,424
$
38,744
$
202,100
$
-
$
414,996
$
428,582
Total:
Accrual Status:
Performing
$
58,261
$
50,307
$
32,160
$
33,150
$
38,744
$
197,602
$
-
$
410,224
$
422,170
Non-Performing
-
-
-
274
-
5,244
-
5,518
7,152
Total residential mortgage loans in Florida region
$
58,261
$
50,307
$
32,160
$
33,424
$
38,744
$
202,846
$
-
$
415,742
$
429,322
(1)
Excludes accrued interest receivable.
As of September 30, 2022
As of
December 31,
2021
Term Loans
Amortized Cost Basis by Origination Year
(1)
(In thousands)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
Total:
FHA/VA government-guaranteed loans
Accrual Status:
Performing
$
705
$
323
$
828
$
1,291
$
3,871
$
111,945
$
-
$
118,963
$
125,392
Non-Performing
-
-
-
-
-
-
-
-
-
Total FHA/VA
 
government-guaranteed loans
$
705
$
323
$
828
$
1,291
$
3,871
$
111,945
$
-
$
118,963
$
125,392
Conventional residential mortgage loans:
Accrual Status:
Performing
$
172,224
$
127,664
$
64,219
$
82,947
$
112,375
$
2,109,546
$
-
$
2,668,975
$
2,798,376
Non-Performing
-
35
-
387
279
42,335
-
43,036
55,127
Total conventional residential mortgage loans
$
172,224
$
127,699
$
64,219
$
83,334
$
112,654
$
2,151,881
$
-
$
2,712,011
$
2,853,503
Total:
Accrual Status:
Performing
$
172,929
$
127,987
$
65,047
$
84,238
$
116,246
$
2,221,491
$
-
$
2,787,938
$
2,923,768
Non-Performing
-
35
-
387
279
42,335
-
43,036
55,127
Total residential mortgage loans
$
172,929
$
128,022
$
65,047
$
84,625
$
116,525
$
2,263,826
$
-
$
2,830,974
$
2,978,895
(1)
Excludes accrued interest receivable.
The following tables
 
present the amortized
 
cost of consumer
 
loans by origination
 
year based on
 
accrual status as
 
of September 30,
2022 and the amortized cost of consumer loans by accrual status as of December 31,
 
2021:
As of September 30, 2022
As of
December 31,
2021
Term Loans
Amortized Cost Basis by Origination Year
(1)
(In thousands)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
Puerto Rico and Virgin Islands Region:
Auto loans:
Accrual Status:
Performing
$
530,902
$
544,149
$
275,432
$
227,501
$
112,215
$
50,723
$
-
$
1,740,922
$
1,556,097
Non-Performing
552
1,656
1,353
2,408
1,414
1,308
-
8,691
6,684
Total auto loans
$
531,454
$
545,805
$
276,785
$
229,909
$
113,629
$
52,031
$
-
$
1,749,613
$
1,562,781
Finance leases:
Accrual Status:
Performing
$
212,139
$
200,819
$
94,148
$
88,244
$
54,392
$
17,942
$
-
$
667,684
$
574,139
Non-Performing
39
298
321
248
204
320
-
1,430
866
Total finance leases
$
212,178
$
201,117
$
94,469
$
88,492
$
54,596
$
18,262
$
-
$
669,114
$
575,005
Personal loans:
Accrual Status:
Performing
$
141,759
$
63,308
$
33,960
$
62,696
$
27,401
$
17,474
$
-
$
346,598
$
314,867
Non-Performing
87
281
192
381
81
124
-
1,146
1,208
Total personal loans
$
141,846
$
63,589
$
34,152
$
63,077
$
27,482
$
17,598
$
-
$
347,744
$
316,075
Credit cards:
Accrual Status:
Performing
$
-
$
-
$
-
$
-
$
-
$
-
$
304,072
$
304,072
$
290,226
Non-Performing
-
-
-
-
-
-
-
-
-
Total credit cards
$
-
$
-
$
-
$
-
$
-
$
-
$
304,072
$
304,072
$
290,226
Other consumer loans:
Accrual Status:
Performing
$
65,494
$
27,107
$
10,670
$
14,597
$
4,983
$
4,672
$
8,985
$
136,508
$
126,734
Non-Performing
218
364
88
184
61
335
136
1,386
1,563
Total other consumer loans
$
65,712
$
27,471
$
10,758
$
14,781
$
5,044
$
5,007
$
9,121
$
137,894
$
128,297
Total:
Performing
$
950,294
$
835,383
$
414,210
$
393,038
$
198,991
$
90,811
$
313,057
$
3,195,784
$
2,862,063
Non-Performing
896
2,599
1,954
3,221
1,760
2,087
136
12,653
10,321
Total consumer loans in Puerto Rico and Virgin
Islands region
$
951,190
$
837,982
$
416,164
$
396,259
$
200,751
$
92,898
$
313,193
$
3,208,437
$
2,872,384
(1)
Excludes accrued interest receivable.
As of September 30, 2022
As of
December 31,
2021
Term Loans
Amortized Cost Basis by Origination Year
(1)
(In thousands)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
Florida Region:
Auto loans:
Accrual Status:
Performing
$
-
$
-
$
-
$
377
$
2,830
$
1,468
$
-
$
4,675
$
8,759
Non-Performing
-
-
-
-
-
12
-
12
-
Total auto loans
$
-
$
-
$
-
$
377
$
2,830
$
1,480
$
-
$
4,687
$
8,759
Finance leases:
Accrual Status:
Performing
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
Non-Performing
-
-
-
-
-
-
-
-
-
Total finance leases
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
Personal loans:
Accrual Status:
Performing
$
274
$
71
$
13
$
-
$
-
$
-
$
-
$
358
$
107
Non-Performing
-
-
-
-
-
-
-
-
-
Total personal loans
$
274
$
71
$
13
$
-
$
-
$
-
$
-
$
358
$
107
Credit cards:
Accrual Status:
Performing
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
Non-Performing
-
-
-
-
-
-
-
-
-
Total credit cards
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
$
-
Other consumer loans:
Accrual Status:
Performing
$
50
$
233
$
469
$
-
$
39
$
2,929
$
2,426
$
6,146
$
6,661
Non-Performing
-
-
-
-
-
22
100
122
133
Total other consumer loans
$
50
$
233
$
469
$
-
$
39
$
2,951
$
2,526
$
6,268
$
6,794
Total:
Performing
$
324
$
304
$
482
$
377
$
2,869
$
4,397
$
2,426
$
11,179
$
15,527
Non-Performing
-
-
-
-
-
34
100
134
133
Total consumer loans in Florida region
$
324
$
304
$
482
$
377
$
2,869
$
4,431
$
2,526
$
11,313
$
15,660
(1)
Excludes accrued interest receivable.
As of September 30, 2022
As of
December 31,
2021
Term Loans
Amortized Cost Basis by Origination Year
(1)
(In thousands)
2022
2021
2020
2019
2018
Prior
Revolving
Loans
Amortized
Cost Basis
Total
Total
Total:
Auto loans:
Accrual Status:
Performing
$
530,902
$
544,149
$
275,432
$
227,878
$
115,045
$
52,191
$
-
$
1,745,597
$
1,564,856
Non-Performing
552
1,656
1,353
2,408
1,414
1,320
-
8,703
6,684
Total auto loans
$
531,454
$
545,805
$
276,785
$
230,286
$
116,459
$
53,511
$
-
$
1,754,300
$
1,571,540
Finance leases:
Accrual Status:
Performing
$
212,139
$
200,819
$
94,148
$
88,244
$
54,392
$
17,942
$
-
$
667,684
$
574,139
Non-Performing
39
298
321
248
204
320
-
1,430
866
Total finance leases
$
212,178
$
201,117
$
94,469
$
88,492
$
54,596
$
18,262
$
-
$
669,114
$
575,005
Personal loans:
Accrual Status:
Performing
$
142,033
$
63,379
$
33,973
$
62,696
$
27,401
$
17,474
$
-
$
346,956
$
314,974
Non-Performing
87
281
192
381
81
124
-
1,146
1,208
Total personal loans
$
142,120
$
63,660
$
34,165
$
63,077
$
27,482
$
17,598
$
-
$
348,102
$
316,182
Credit cards:
Accrual Status:
Performing
$
-
$
-
$
-
$
-
$
-
$
-
$
304,072
$
304,072
$
290,226
Non-Performing
-
-
-
-
-
-
-
-
-
Total credit cards
$
-
$
-
$
-
$
-
$
-
$
-
$
304,072
$
304,072
$
290,226
Other consumer loans:
Accrual Status:
Performing
$
65,544
$
27,340
$
11,139
$
14,597
$
5,022
$
7,601
$
11,411
$
142,654
$
133,395
Non-Performing
218
364
88
184
61
357
236
1,508
1,696
Total other consumer loans
$
65,762
$
27,704
$
11,227
$
14,781
$
5,083
$
7,958
$
11,647
$
144,162
$
135,091
Total:
Performing
$
950,618
$
835,687
$
414,692
$
393,415
$
201,860
$
95,208
$
315,483
$
3,206,963
$
2,877,590
Non-Performing
896
2,599
1,954
3,221
1,760
2,121
236
12,787
10,454
Total consumer loans
$
951,514
$
838,286
$
416,646
$
396,636
$
203,620
$
97,329
$
315,719
$
3,219,750
$
2,888,044
(1)
Excludes accrued interest receivable.
Accrued interest
 
receivable on
 
loans totaled
 
$
47.4
 
million as of
 
September 30,
 
2022 ($
48.1
 
million as of
 
December 31, 2021),
 
was
reported as
 
part of accrued
 
interest receivable on
 
loans and investment
 
securities in the
 
consolidated statements
 
of financial
 
condition
and is excluded from the estimate of credit losses.
The
 
following
 
tables
 
present
 
information
 
about
 
collateral
 
dependent
 
loans
 
that
 
were
 
individually
 
evaluated
 
for
 
purposes
 
of
determining the ACL as of September 30, 2022 and December 31, 2021:
September 30, 2022
Collateral Dependent Loans - With
Allowance
Collateral Dependent
Loans - With No
Related Allowance
Collateral Dependent Loans - Total
Amortized Cost
Related Allowance
Amortized Cost
Amortized Cost
Related Allowance
(In thousands)
Residential mortgage loans:
FHA/VA government
 
-guaranteed loans
$
-
$
-
$
-
$
-
$
-
Conventional residential mortgage loans
38,898
2,706
592
39,490
2,706
Commercial loans:
Construction loans
-
-
956
956
-
Commercial mortgage loans
3,070
933
62,366
65,436
933
C&I loans
17,695
2,788
19,940
37,635
2,788
Consumer loans:
Auto loans
-
-
-
-
-
Finance leases
-
-
-
-
-
Personal loans
57
1
-
57
1
Credit cards
-
-
-
-
-
Other consumer loans
280
34
-
280
34
$
60,000
$
6,462
$
83,854
$
143,854
$
6,462
December 31, 2021
Collateral Dependent Loans - With
Allowance
Collateral Dependent
Loans - With No
Related Allowance
Collateral Dependent Loans - Total
Amortized Cost
Related Allowance
Amortized Cost
Amortized Cost
Related Allowance
(In thousands)
Residential mortgage loans:
FHA/VA government
 
-guaranteed loans
$
-
$
-
$
-
$
-
$
-
Conventional residential mortgage loans
51,771
3,966
781
52,552
3,966
Commercial loans:
Construction loans
-
-
1,797
1,797
-
Commercial mortgage loans
9,908
1,152
56,361
66,269
1,152
C&I loans
5,781
670
34,043
39,824
670
Consumer loans:
Auto loans
-
-
-
-
-
Finance leases
-
-
-
-
-
Personal loans
78
1
-
78
1
Credit cards
-
-
-
-
-
Other consumer loans
782
98
-
782
98
$
68,320
$
5,887
$
92,982
$
161,302
$
5,887
The allowance related
 
to collateral dependent loans
 
reported in the tables
 
above includes qualitative
 
adjustments applied to
 
the loan
portfolio
 
that
 
consider
 
possible
 
changes
 
in
 
circumstances
 
that
 
could
 
ultimately
 
impact
 
credit
 
losses
 
and
 
might
 
not
 
be
 
reflected
 
in
historical
 
data
 
or
 
forecasted
 
data
 
incorporated
 
in
 
the
 
quantitative
 
models.
 
The
 
underlying
 
collateral
 
for
 
residential
 
mortgage
 
and
consumer
 
collateral
 
dependent
 
loans
 
consisted
 
of
 
single-family
 
residential
 
properties,
 
and
 
for
 
commercial
 
and
 
construction
 
loans
consisted
 
primarily
 
of
 
office
 
buildings,
 
multifamily
 
residential
 
properties,
 
and
 
retail
 
establishments.
 
The
 
weighted-average
 
loan-to-
value coverage
 
for collateral dependent
 
loans as of
 
September 30, 2022
 
was
76
%, compared to
78
% as of
 
December 31, 2021,
 
which
was not considered a significant change in the extent to which collateral secured
 
these loans.
Purchases and Sales of Loans
During
 
the
 
first
 
nine
 
months
 
of
 
2022,
 
loans
 
pooled
 
into
 
GNMA
 
MBS
 
amounted
 
to
 
approximately
 
$
115.7
 
million,
 
compared
 
to
$
147.4
 
million
 
for
 
the
 
same
 
period
 
in
 
2021.
 
Also,
 
during
 
the
 
first
 
nine
 
months
 
of
 
2022,
 
the
 
Corporation
 
sold
 
approximately
 
$
90.8
million
 
of
 
performing
 
residential
 
mortgage
 
loans
 
to
 
FNMA
 
and
 
FHLMC,
 
compared
 
to
 
sales of
 
$
259.6
 
million
 
during
 
the
 
first
 
nine
months
 
of
 
2021.
 
The
 
Corporation’s
 
continuing
 
involvement
 
with
 
the
 
loans
 
that
 
it
 
sells
 
consists
 
primarily
 
of
 
servicing
 
the
 
loans.
 
In
addition,
 
the
 
Corporation
 
agrees
 
to
 
repurchase
 
loans
 
if
 
it
 
breaches
 
any
 
of
 
the
 
representations
 
and
 
warranties
 
included
 
in
 
the
 
sale
agreement. These
 
representations and
 
warranties are consistent
 
with the GSEs’
 
selling and servicing
 
guidelines (
i.e.
, ensuring that
 
the
mortgage was properly underwritten according to established guidelines).
For loans
 
pooled into
 
GNMA MBS,
 
the Corporation,
 
as servicer,
 
holds an
 
option to
 
repurchase individual
 
delinquent loans
 
issued
on or
 
after January 1,
 
2003 when certain
 
delinquency criteria are
 
met. This option
 
gives the Corporation
 
the unilateral ability,
 
but not
the obligation, to
 
repurchase the delinquent
 
loans at par without
 
prior authorization from
 
GNMA. Since the
 
Corporation is considered
to
 
have
 
regained
 
effective
 
control
 
over
 
the
 
loans,
 
it
 
is
 
required
 
to
 
recognize
 
the
 
loans
 
and
 
a
 
corresponding
 
repurchase
 
liability
regardless of its
 
intent to repurchase
 
the loans. As
 
of September
 
30, 2022 and
 
December 31, 2021,
 
rebooked GNMA delinquent
 
loans
that were included in the residential mortgage loan portfolio amounted
 
to $
8.1
 
million and $
7.2
 
million, respectively.
 
In addition,
 
on
 
September 29,
 
2022,
 
GNMA expanded
 
the criteria
 
to permit
 
issuers to
 
repurchase
 
loans of
 
borrowers
 
affected
 
by
Hurricane Fiona
 
that meet
 
the following
 
eligibility requirements:
 
(i) the
 
property securing
 
the loans
 
has been
 
damaged and
 
is located
within
 
a
 
designated
 
disaster
 
area;
 
and
 
(ii)
 
the
 
borrower
 
is
 
experiencing
 
economic
 
hardship
 
related
 
to
 
the
 
designated
 
disaster,
 
as
established by the
 
underlying insuring or
 
guaranteeing agency.
 
Issuers must request
 
and obtain prior
 
written approval from
 
GNMA to
repurchase eligible loans.
During
 
the
 
first
 
nine
 
months
 
of
 
2022
 
and
 
2021,
 
the
 
Corporation
 
repurchased,
 
pursuant
 
to
 
the
 
aforementioned
 
repurchase
 
option,
$
8.2
 
million and $
0.4
 
million, respectively,
 
of loans previously pooled
 
into GNMA MBS. The
 
principal balance of these
 
loans is fully
guaranteed, and
 
the risk
 
of loss
 
related to
 
the repurchased
 
loans is
 
generally limited
 
to the
 
difference
 
between the
 
delinquent interest
payment advanced
 
to GNMA, which
 
is computed at
 
the loan’s
 
interest rate, and
 
the interest payments
 
reimbursed by FHA,
 
which are
computed
 
at a
 
pre-determined
 
debenture
 
rate. Repurchases
 
of GNMA
 
loans allow
 
the
 
Corporation,
 
among
 
other
 
things, to
 
maintain
acceptable delinquency rates on outstanding GNMA pools and remain as a seller and
 
servicer in good standing with GNMA.
Loan
 
sales
 
to
 
FNMA
 
and
 
FHLMC
 
are
 
without
 
recourse
 
in
 
relation
 
to
 
the
 
future
 
performance
 
of
 
the
 
loans.
 
The
 
Corporation
repurchased at par loans previously sold to FNMA and FHLMC in the amount
 
of $
0.3
 
million during the first nine months of 2022 and
2021. The
 
Corporation’s
 
risk of
 
loss with
 
respect to
 
these loans
 
is also
 
minimal as
 
these repurchased
 
loans are
 
generally performing
loans with documentation deficiencies.
During
 
the
 
first
 
nine
 
months
 
of
 
2022,
 
the
 
Corporations
 
sold
 
a
 
$
35.2
 
million
 
commercial
 
and
 
industrial
 
loan
 
participation
 
in
 
the
Puerto
 
Rico region.
 
Also, during
 
the first
 
nine
 
months of
 
2021,
 
three criticized
 
commercial loan
 
participations
 
in the
 
Florida
 
region
totaling $
28.0
 
million were
 
sold. In
 
addition, during
 
the first
 
nine months
 
of 2022
 
and 2021,
 
the Corporation
 
purchased commercial
and industrial loans participations in the Florida region totaling $
135.4
 
million and $
78.1
 
million, respectively.
During
 
the
 
third
 
quarter
 
of
 
2021,
 
the
 
Corporation
 
sold
 
$
52.5
 
million
 
of non-performing
 
residential
 
mortgage
 
loans
 
and
 
related
servicing
 
advances
 
of
 
$
2.0
 
million.
 
The
 
Corporation
 
received
 
$
31.5
 
million,
 
or
58
%
 
of
 
book
 
value
 
before
 
reserves,
 
for
 
the
$
54.5
 
million of non-performing
 
loans and related
 
servicing advances.
 
Approximately $
20.9
 
million of reserves
 
had been allocated
 
to
the loans
 
sold. The
 
transaction resulted
 
in total
 
net charge-offs
 
of $
23.1
 
million and
 
an additional
 
loss of
 
approximately $
2.1
 
million
recorded as a charge to the provision for credit losses in the third
 
quarter of 2021.
Loan Portfolio Concentration
The Corporation’s
 
primary lending
 
area is
 
Puerto Rico.
 
The Corporation’s
 
banking subsidiary,
 
FirstBank, also
 
lends in
 
the USVI
and BVI markets
 
and in the
 
United States (principally
 
in the state of
 
Florida). Of
 
the total gross
 
loans held for
 
investment portfolio
 
of
$
11.3
 
billion as
 
of September
 
30, 2022,
 
credit risk
 
concentration
 
was approximately
79
% in
 
Puerto Rico,
18
% in
 
the United
 
States,
and
3
% in the USVI and BVI.
As of
 
September
 
30,
 
2022,
 
the Corporation
 
had $
158.4
 
million outstanding
 
in loans
 
extended
 
to the
 
Puerto
 
Rico government,
 
its
municipalities
 
and
 
public
 
corporations,
 
compared
 
to
 
$
178.4
 
million
 
as
 
of
 
December
 
31,
 
2021.
 
As
 
of
 
September
 
30,
 
2022,
approximately
 
$
89.9
 
million
 
consisted
 
of
 
loans
 
extended
 
to
 
municipalities
 
in
 
Puerto
 
Rico
 
that
 
are
 
general
 
obligations
 
supported
 
by
assigned
 
property
 
tax
 
revenues,
 
and
 
$
29.0
 
million
 
of
 
loans
 
which
 
are
 
supported
 
by
 
one
 
or
 
more
 
specific
 
sources
 
of
 
municipal
revenues.
 
The
 
vast
 
majority
 
of
 
revenues
 
of
 
the
 
municipalities
 
included
 
in
 
the
 
Corporation’s
 
loan
 
portfolio
 
are
 
independent
 
of
budgetary subsidies provided by the Puerto Rico
 
central government. These municipalities are required
 
by law to levy special property
taxes in such amounts as are required to
 
satisfy the payment of all of their respective general obligation
 
bonds and notes. In addition to
loans extended to
 
municipalities, the Corporation’s
 
exposure to the
 
Puerto Rico government
 
as of September
 
30, 2022 included
 
$
11.5
million in loans granted to an affiliate of
 
the Puerto Rico Electric Power Authority (“PREPA”)
 
and $
28.0
 
million in loans to an agency
of the Puerto Rico central government.
In
 
addition,
 
as
 
of
 
September
 
30,
 
2022,
 
the
 
Corporation
 
had
 
$
86.7
 
million
 
in
 
exposure
 
to
 
residential
 
mortgage
 
loans
 
that
 
are
guaranteed by
 
the PRHFA,
 
a governmental
 
instrumentality that
 
has been
 
designated as
 
a covered
 
entity under
 
PROMESA, compared
to
 
$
92.8
 
million
 
as
 
of
 
December
 
31,
 
2021.
 
Residential
 
mortgage
 
loans
 
guaranteed
 
by
 
the
 
PRHFA
 
are
 
secured
 
by
 
the
 
underlying
properties and the guarantees serve to cover shortfalls in collateral in the event
 
of a borrower default.
The
 
Corporation
 
also
 
has
 
credit
 
exposure
 
to
 
USVI
 
government
 
entities.
 
As
 
of
 
September
 
30,
 
2022,
 
the
 
Corporation
 
had
 
$
37.6
million in loans
 
to USVI government
 
public corporations,
 
compared to $
39.2
 
million as of
 
December 31,
 
2021.
 
As of September
 
30,
2022, all loans were currently performing and up to date on principal
 
and interest payments.
Troubled Debt
 
Restructurings
The Corporation
 
provides
 
homeownership
 
preservation
 
assistance to
 
its customers
 
through
 
a loss
 
mitigation
 
program.
 
Depending
upon
 
the
 
nature
 
of
 
a
 
borrower’s
 
financial
 
condition,
 
restructurings
 
or
 
loan
 
modifications
 
through
 
this
 
program,
 
as
 
well
 
as
 
other
restructurings of
 
individual
 
C&I, commercial
 
mortgage, construction,
 
and residential
 
mortgage loans,
 
fit the
 
definition of
 
a TDR.
 
As
of September
 
30, 2022,
 
the Corporation’s
 
total TDR
 
loans held
 
for investment
 
amounted to
 
$
387.7
 
million, of
 
which $
340.1
 
million
were in accruing
 
status. See Note 8
 
– Loans Held for
 
Investment to the
 
consolidated financial statements
 
included in the
 
2021 Annual
Report on
 
Form 10-K,
 
for information
 
on when
 
the Corporation
 
classifies TDR
 
loans as
 
either accrual
 
or nonaccrual
 
loans. The
 
total
TDR loans held for investment
 
consisted of $
242.4
 
million of residential mortgage
 
loans, $
67.2
 
million of C&I loans, $
64.2
 
million of
commercial mortgage
 
loans, $
1.3
 
million of
 
construction loans,
 
and $
12.6
 
million of
 
consumer loans.
 
As of
 
September 30,
 
2022, the
Corporation
 
included
 
as
 
TDRs
 
$
1.6
 
million
 
of
 
residential
 
mortgage
 
loans
 
that
 
were
 
participating
 
in
 
or
 
had
 
been
 
offered
 
a
 
trial
modification,
 
which
 
generally
 
represents
 
a
 
six-month
 
period
 
during
 
which
 
the
 
borrower
 
makes
 
monthly
 
payments
 
under
 
the
anticipated modified payment terms prior
 
to a formal modification. TDR loans
 
exclude restructured
 
residential mortgage loans that are
government-guaranteed
 
(
e.g
.,
 
FHA/VA
 
loans)
 
totaling
 
$
54.8
 
million
 
as
 
of
 
September
 
30,
 
2022,
 
compared
 
with
 
$
57.6
 
million
 
as
 
of
December
 
31,
 
2021.
 
As
 
of
 
September
 
30,
 
2022,
 
the
 
Corporation
 
has
 
committed
 
to
 
lend
 
up
 
to
 
additional
 
$
16
 
thousand
 
on
 
TDR
consumer loans.
To
 
assist
 
borrowers
 
affected
 
by
 
the
 
passing
 
of
 
Hurricane
 
Fiona
 
through
 
Puerto
 
Rico
 
on
 
September
 
17,
 
2022,
 
the
 
Corporation
established a
 
Natural Disaster
 
Deferral or
 
Extension Program,
 
with a
 
term not
 
to extend
 
beyond December
 
31, 2022,
 
for residents
 
of
Puerto Rico that were
 
directly impacted by
 
the passing of the hurricane.
 
This program provides payment
 
deferral or term extension
 
on
a one payment
 
basis, not to
 
exceed three payments,
 
to retail borrowers
 
(
i.e.,
 
borrowers with personal
 
loans, auto loans,
 
finance leases,
credit cards and
 
residential mortgage loans)
 
that contacted the
 
Corporation by October
 
31, 2022 to
 
request the payment
 
extension and
opted-in based
 
on conditions
 
below.
 
Loans will
 
continue
 
to accrue
 
interest during
 
the deferral
 
or extension
 
period.
 
For credit
 
cards,
borrowers who
 
were 30
 
days past
 
due or
 
less as
 
of September
 
16, 2022
 
are eligible
 
for this
 
program. For
 
residential mortgage
 
loans
and consumer
 
loans, borrowers
 
who were
 
60 days
 
past due
 
or less
 
as of
 
September 16,
 
2022 are
 
eligible for
 
this program.
 
For both
consumer and residential mortgage loans subject to the deferral programs,
 
each borrower is required to opt in on a monthly basis to the
program
 
and
 
must
 
resume
 
making
 
their
 
regularly
 
scheduled
 
loan
 
payments
 
at
 
the
 
end
 
of
 
the
 
deferral
 
period.
 
For
 
consumer
 
loans,
deferred amounts
 
will extend
 
the maturity
 
date by
 
the number
 
of deferred
 
periods. For
 
residential mortgage
 
loans, deferred
 
amounts
will be
 
moved to
 
the end
 
of the
 
loan term.
 
Borrowers that
 
make a
 
payment during
 
any given
 
month are
 
not eligible
 
for the
 
program
during that
 
month. Furthermore,
 
for customers
 
that opted
 
into the
 
program, the
 
delinquency
 
status of
 
loans subject
 
to the
 
deferral or
extension program will be frozen to the status that existed in the month previous
 
to the month in which the relief is granted.
 
Loans subject
 
to the above-described
 
program are not
 
considered TDRs since
 
the deferral or
 
extension is not
 
considered more than
insignificant.
 
Borrowers
 
were
 
eligible
 
to
 
payment
 
deferral
 
or
 
extension
 
of
 
three
 
payments
 
only
 
if
 
cumulative
 
payment
 
extensions
granted during
 
the last 12
 
months did not
 
exceed six payments,
 
including the
 
extensions granted through
 
this program. As
 
of October
31, 2022, the Corporation has entered into deferral or extension
 
payment agreements on
3,366
 
retail loans totaling $
63.6
 
million.
The
 
following
 
tables
 
present
 
TDR
 
loans
 
completed
 
during
 
the
 
quarters
 
and
 
nine-month
 
periods
 
ended
 
September
 
30,
 
2022
 
and
2021:
Quarter Ended September 30, 2022
Interest rate
below market
Maturity or
term extension
Combination of
reduction in
interest rate
and extension
of maturity
Forgiveness of
principal
and/or interest
Other
(1)
Total
(In thousands)
TDRs:
Conventional residential mortgage loans
$
-
$
132
$
-
$
-
$
1,022
$
1,154
Construction loans
-
-
-
-
-
-
Commercial mortgage loans
-
-
-
-
-
-
C&I loans
495
-
-
-
-
495
Consumer loans:
Auto loans
661
42
84
-
-
787
Finance leases
-
82
-
-
-
82
Personal loans
-
75
58
-
-
133
Credit cards
-
-
-
-
252
252
Other consumer loans
10
56
-
19
-
85
Total TDRs
$
1,166
$
387
$
142
$
19
$
1,274
$
2,988
(1)
Other concessions granted by the Corporation include payment
 
plans under judicial stipulation or loss mitigation
 
programs, or a combination of two or more of
 
the concessions listed in the
table. Amounts included in Other that represent a combination
 
of concessions are excluded from the amounts reported in the column
 
for such individual concessions.
Nine-Month Period Ended September 30, 2022
Interest rate
below market
Maturity or
term extension
Combination of
reduction in
interest rate
and extension
of maturity
Forgiveness of
principal
and/or interest
Other
(1)
Total
(In thousands)
TDRs:
Conventional residential mortgage loans
$
215
$
1,484
$
190
$
-
$
3,709
$
5,598
Construction loans
-
-
-
-
-
-
Commercial mortgage loans
-
245
5,178
-
467
5,890
C&I loans
895
-
-
825
1,083
2,803
Consumer loans:
Auto loans
2,120
126
264
-
-
2,510
Finance leases
-
451
-
-
18
469
Personal loans
99
135
84
-
-
318
Credit cards
-
-
-
-
647
647
Other consumer loans
93
188
-
37
-
318
Total TDRs
 
$
3,422
$
2,629
$
5,716
$
862
$
5,924
$
18,553
(1)
Other concessions granted by the Corporation include payment
 
plans under judicial stipulation or loss mitigation programs, or
 
a combination of two or more of the concessions listed
 
in the
table. Amounts included in Other that represent a combination
 
of concessions are excluded from the amounts reported in the column
 
for such individual concessions.
Quarter Ended September 30, 2021
Interest rate
below market
Maturity or
term extension
Combination of
reduction in
interest rate
and extension
of maturity
Forgiveness of
principal
and/or interest
Other
(1)
Total
(In thousands)
TDRs:
Conventional residential mortgage loans
$
345
$
759
$
92
$
-
$
1,454
$
2,650
Construction loans
-
-
-
-
-
-
Commercial mortgage loans
-
-
10,331
-
-
10,331
C&I loans
-
-
9,100
-
-
9,100
Consumer loans:
Auto loans
364
14
58
-
-
436
Finance leases
-
165
26
-
-
191
Personal loans
13
23
67
-
-
103
Credit cards
-
-
-
-
207
207
Other consumer loans
17
28
-
15
-
60
Total TDRs
$
739
$
989
$
19,674
$
15
$
1,661
$
23,078
(1)
Other concessions granted by the Corporation include payment
 
plans under judicial stipulation or loss mitigation programs, or
 
a combination of two or more of the concessions listed
 
in the
table. Amounts included in Other that represent a combination
 
of concessions are excluded from the amounts reported in the column
 
for such individual concessions.
Nine-Month Period Ended September 30, 2021
Interest rate
below market
Maturity or
term extension
Combination of
reduction in
interest rate
and extension
of maturity
Forgiveness of
principal
and/or interest
Other
(1)
Total
(In thousands)
TDRs:
Conventional residential mortgage loans
$
365
$
759
$
1,605
$
-
$
2,718
$
5,447
Construction loans
-
-
-
-
-
-
Commercial mortgage loans
-
-
10,586
-
442
11,028
C&I loans
-
300
9,100
-
171
9,571
Consumer loans:
Auto loans
1,372
309
196
-
-
1,877
Finance leases
-
526
26
-
-
552
Personal loans
13
52
263
-
8
336
Credit cards
-
-
-
-
1,171
1,171
Other consumer loans
105
68
-
61
-
234
Total TDRs
 
$
1,855
$
2,014
$
21,776
$
61
$
4,510
$
30,216
(1)
Other concessions granted by the Corporation include payment
 
plans under judicial stipulation or loss mitigation programs, or
 
a combination of two or more of the concessions listed
 
in the
table. Amounts included in Other that represent a combination
 
of concessions are excluded from the amounts reported in the column
 
for such individual concessions.
Quarter Ended September 30, 2022
Quarter Ended September 30, 2021
Number of
contracts
Pre-modification
Amortized Cost
Post-modification
Amortized Cost
Number of
contracts
Pre-modification
Amortized Cost
Post-modification
Amortized Cost
(Dollars in thousands)
TDRs:
Conventional residential mortgage loans
12
$
1,220
$
1,154
23
$
2,654
$
2,650
Construction loans
-
-
-
-
-
-
Commercial mortgage loans
-
-
-
2
10,433
10,331
C&I loans
3
495
495
3
9,100
9,100
Consumer loans:
Auto loans
35
790
787
22
435
436
Finance leases
5
82
82
10
190
191
Personal loans
7
116
133
9
103
103
Credit Cards
50
251
252
40
207
207
Other consumer loans
29
83
85
14
59
60
Total TDRs
141
$
3,037
$
2,988
123
$
23,181
$
23,078
Nine-Month Period Ended September 30, 2022
Nine-Month Period Ended September 30, 2021
Number of
contracts
Pre-modification
Amortized Cost
Post-modification
Amortized Cost
Number of
contracts
Pre-modification
Amortized Cost
Post-modification
Amortized Cost
(Dollars in thousands)
TDRs:
Conventional residential mortgage loans
49
$
5,668
$
5,598
48
$
5,552
$
5,447
Construction loans
-
-
-
-
-
-
Commercial mortgage loans
3
5,897
5,890
6
11,091
11,028
C&I loans
15
3,031
2,803
5
9,694
9,571
Consumer loans:
Auto loans
123
2,512
2,510
101
1,875
1,877
Finance leases
26
469
469
33
550
552
Personal loans
19
301
318
32
330
336
Credit Cards
139
646
647
203
1,171
1,171
Other consumer loans
77
311
318
55
233
234
Total TDRs
451
$
18,835
$
18,553
483
$
30,496
$
30,216
Loan modifications considered
 
TDR loans that defaulted
 
(failure by the borrower
 
to make payments
 
of either principal, interest,
 
or
both
 
for
 
a
 
period
 
of
 
90
 
days
 
or
 
more)
 
during
 
the
 
quarters
 
and
 
nine-month
 
periods
 
ended
 
September
 
30,
 
2022
 
and
 
2021,
 
and
 
had
become TDR loans during the 12-months preceding the default date, were
 
as follows:
Quarter Ended September 30, 2022
Quarter Ended September 30, 2021
Number of
contracts
Amortized Cost
Number of
contracts
Amortized Cost
(Dollars in thousands)
Conventional residential mortgage loans
1
$
50
2
$
126
Construction loans
-
-
-
-
Commercial mortgage loans
-
-
-
-
C&I loans
-
-
-
-
Consumer loans:
Auto loans
31
776
23
433
Finance leases
-
-
-
-
Personal loans
-
-
1
1
Credit cards
14
60
13
68
Other consumer loans
1
2
-
-
Total
47
$
888
39
$
628
Nine-Month Period Ended September
30, 2022
Nine-Month Period Ended September
30, 2021
Number of
contracts
Amortized Cost
Number of
contracts
Amortized Cost
(Dollars in thousands)
Conventional residential mortgage loans
5
$
534
4
$
304
Construction loans
-
-
-
-
Commercial mortgage loans
-
-
-
-
C&I loans
-
-
-
-
Consumer loans:
Auto loans
75
1,674
69
1,164
Finance leases
1
16
-
-
Personal loans
-
-
1
1
Credit cards
39
201
25
161
Other consumer loans
5
19
9
36
Total
125
$
2,444
108
$
1,666
For
 
certain
 
TDR
 
loans,
 
the
 
Corporation
 
splits
 
the
 
loans
 
into
 
two
 
new
 
notes
 
(the
 
“Note
 
A”
 
and
 
the
 
“Note
 
B”).
 
The
 
A
 
Note
 
is
restructured to comply
 
with the Corporation’s
 
lending standards at
 
current market rates
 
and is tailored to
 
suit the customer’s
 
ability to
make
 
timely
 
interest
 
and
 
principal
 
payments.
 
The
 
B
 
Note
 
includes
 
the
 
granting
 
of
 
the
 
concession
 
to
 
the
 
borrower
 
and
 
varies
 
by
situation. The
 
B Note is
 
fully charged-off,
 
unless it is
 
collateral-dependent and
 
the source of
 
repayment is
 
independent of
 
the A Note
in which
 
case a
 
partial charge
 
-off may
 
be recorded.
 
At the
 
time of
 
the restructuring,
 
the A Note
 
is identified
 
and classified
 
as a
 
TDR
loan. During the nine months ended September 30, 2022 and 2021, there were
 
no new Note A and B restructurings.