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SEGMENT INFORMATION | 9 Months Ended
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Sep. 30, 2023
SEGMENT INFORMATION [Abstract] |
SEGMENT INFORMATION | NOTE 20 – SEGMENT INFORMATION Based upon the Corporation’s organizational structure and the information provided to the Chief Executive Officer, the operating segments are based primarily on 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 September 30, 2023, the Corporation had six reportable segments: Mortgage Banking; Consumer (Retail) Banking; Commercial and Corporate Banking; Treasury and Investments; United States Operations; and Virgin Islands Operations. Management determined the reportable segments based on the internal structure 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 Mortgage Banking segment consists of the origination, sale, and servicing of 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. The 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 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 Treasury and Investments segment is responsible for the Corporation’s investment portfolio and treasury functions that are executed to manage and enhance liquidity. This segment lends funds to the Commercial and Corporate Banking, the Mortgage Banking, the Consumer (Retail) Banking, and the United States Operations segments to finance their lending activities and borrows from those segments. The Consumer (Retail) Banking segment also lends funds to other segments. The interest rates charged or credited by the Treasury and Investments and the Consumer (Retail) Banking 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 consumer banking services. The Virgin Islands Operations segment consists of all banking activities conducted by the Corporation in the USVI and BVI, including commercial and consumer 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 audited consolidated financial statements included in the 2022 Annual Report on Form 10-K. The Corporation evaluates the performance of the segments based on net interest income, the provision for credit losses, non- interest income and direct non-interest expenses. The segments are also evaluated based on the average volume of their interest- earning assets less the ACL. The following tables present information about the reportable segments for the indicated periods: Mortgage Banking Consumer (Retail) Banking Commercial and Corporate Banking Treasury and Investments United States Operations Virgin Islands Operations Total (In thousands) Quarter ended September 30,2023: Interest income $ 31,208 $ 90,976 $ 68,138 $ 32,146 $ 33,560 $ 7,377 $ 263,405 Net (charge) credit for transfer of funds (12,929) 96,836 (54,926) (27,817) (1,164) - - Interest expense - (40,746) - (8,384) (12,647) (1,900) (63,677) Net interest income (loss) 18,279 147,066 13,212 (4,055) 19,749 5,477 199,728 Provision for credit losses - (benefit) expense (3,288) 13,707 (7,235) 32 873 307 4,396 Non-interest income (loss) 3,021 20,170 4,468 (3) 847 1,793 30,296 Direct non-interest expenses 5,201 43,431 9,658 958 8,535 6,647 74,430 Segment income (loss) $ 19,387 $ 110,098 $ 15,257 $ (5,048) $ 11,188 $ 316 $ 151,198 Average earnings assets $ 2,127,641 $ 3,336,158 $ 3,769,370 $ 6,382,276 $ 2,041,662 $ 406,499 $ 18,063,606 Mortgage Banking Consumer (Retail) Banking Commercial and Corporate Banking Treasury and Investments United States Operations Virgin Islands Operations Total (In thousands) Quarter ended September 30,2022: Interest income $ 32,349 $ 77,576 $ 53,506 $ 28,203 $ 24,804 $ 6,245 $ 222,683 Net (charge) credit for transfer of funds (8,011) 47,577 (30,645) (8,447) (474) - - Interest expense - (6,745) - (4,929) (2,836) (263) (14,773) Net interest income 24,338 118,408 22,861 14,827 21,494 5,982 207,910 Provision for credit losses - expense (benefit) 2,092 16,705 (3,519) (12) (624) 1,141 15,783 Non-interest income 3,733 19,121 4,276 33 773 1,757 29,693 Direct non-interest expenses 6,489 42,080 9,295 942 8,479 7,097 74,382 Segment income (loss) $ 19,490 $ 78,744 $ 21,361 $ 13,930 $ 14,412 $ (499) $ 147,438 Average earnings assets $ 2,211,675 $ 2,974,894 $ 3,622,907 $ 7,095,503 $ 2,040,656 $ 365,743 $ 18,311,378 Mortgage Banking Consumer (Retail) Banking Commercial and Corporate Banking Treasury and Investments United States Operations Virgin Islands Operations Total (In thousands) Nine-Month Period Ended September 30,2023 Interest income $ 94,720 $ 261,139 $ 195,837 $ 89,140 $ 96,772 $ 20,397 $ 758,005 Net (charge) credit for transfer of funds (33,293) 260,715 (154,752) (70,095) (2,575) - - Interest expense - (94,447) - (26,547) (33,828) (2,755) (157,577) Net interest income (loss) 61,427 427,407 41,085 (7,502) 60,369 17,642 600,428 Provision for credit losses - (benefit) expense (7,623) 42,600 (2,096) 7 9,545 (305) 42,128 Non-interest income 9,157 62,425 16,788 1,837 2,849 6,029 99,085 Direct non-interest expenses 15,821 126,872 28,363 2,828 25,341 20,203 219,428 Segment income (loss) $ 62,386 $ 320,360 $ 31,606 $ (8,500) $ 28,332 $ 3,773 $ 437,957 Average earnings assets $ 2,147,521 $ 3,251,286 $ 3,751,359 $ 6,321,540 $ 2,049,281 $ 381,655 $ 17,902,642 Mortgage Banking Consumer (Retail) Banking Commercial and Corporate Banking Treasury and Investments United States Operations Virgin Islands Operations Total (In thousands) Nine-Month Period Ended September 30,2022 Interest income $ 98,625 $ 221,500 $ 148,046 $ 77,530 $ 64,742 $ 18,719 $ 629,162 Net (charge) credit for transfer of funds (22,173) 105,898 (53,391) (29,101) (1,233) - - Interest expense - (17,047) - (14,727) (6,845) (823) (39,442) Net interest income 76,452 310,351 94,655 33,702 56,664 17,896 589,720 Provision for credit losses - (benefit) expense (5,216) 42,904 (20,611) (435) (5,849) 1,191 11,984 Non-interest income (loss) 13,152 59,367 13,278 (130) 2,195 5,630 93,492 Direct non-interest expenses 19,076 121,897 27,202 2,732 25,195 20,835 216,937 Segment income $ 75,744 $ 204,917 $ 101,342 $ 31,275 $ 39,513 $ 1,500 $ 454,291 Average earnings assets $ 2,249,203 $ 2,865,610 $ 3,654,906 $ 7,642,121 $ 2,047,375 $ 371,468 $ 18,830,683 The following table presents a reconciliation of the reportable segment financial information to the consolidated totals for the indicated periods: Quarter Ended September 30, Nine-Month Period Ended September 30, 2023 2022 2023 2022 (In thousands) Net income: Total income for segments $ 151,198 $ 147,438 $ 437,957 $ 454,291 Other operating expenses (1) 42,208 40,807 125,395 113,237 Income before income taxes 108,990 106,631 312,562 341,054 Income tax expense 26,968 32,028 89,187 109,156 Total consolidated net income $ 82,022 $ 74,603 $ 223,375 $ 231,898 Average assets: Total average earning assets for segments $ 18,063,606 $ 18,311,378 $ 17,902,642 $ 18,830,683 Average non-earning assets 832,374 835,740 845,837 873,911 Total consolidated average assets $ 18,895,980 $ 19,147,118 $ 18,748,479 $ 19,704,594 (1) Expenses pertaining to corporate administrative functions that support the operating segment, 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.

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 22 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-22 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-15 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 31 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-31 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 42 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-42 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 40 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-40 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//280/tableOfContent Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 26 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-26 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 34 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-34 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 41 -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-41 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 21 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-21 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 32 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147482810/280-10-50-32 + Details
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