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SEGMENT INFORMATION | 3 Months Ended
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Mar. 31, 2025
SEGMENT INFORMATION [Abstract] |
SEGMENT INFORMATION | NOTE 17 – SEGMENT INFORMATION The Corporation’s 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 March 31, 2025, 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. The Chief Executive Officer (“CEO”), who is the designated chief operating decision maker (“CODM”), as ultimate decision maker, evaluates performance and allocates resources based on financial information provided by management. In determining the reportable segments, the Corporation considers factors such as the organizational structure, nature of the products, distribution channels, customer relationship management, and economic characteristics of the business lines. The Corporation evaluates the performance of the segments based on segment income or loss, which consists of net interest income, the provision for credit losses, non-interest income and non-interest expenses. Segment income or loss is measured on a pre-tax basis, consistent with the Corporation’s consolidated financial statements under GAAP. The total segment income or loss equals consolidated pre-tax income or loss, and no adjustments or reconciliations are necessary. The segments are also evaluated based on the average volume of their interest-earning assets (net of fair value adjustments of investment securities and the ACL). 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 market. The Consumer (Retail) Banking segment includes the Corporation’s consumer lending, commercial lending to small businesses, commercial transaction banking, and deposit- taking activities primarily conducted 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 government sector. The Commercial and Corporate Banking segment consists of the Corporation’s commercial lending (other than small business commercial loans) and commercial deposit-taking activities (other than the government sector). The Treasury and Investments segment is responsible for the Corporation’s investment portfolio and treasury functions that are executed to manage and enhance liquidity. Under the Corporation’s fund transfer pricing (“FTP”) methodology, the Treasury and Investments segment centrally manages funding by providing funds to the Mortgage Banking, Consumer (Retail) Banking, Commercial and Corporate Banking, United States Operations, and Virgin Islands Operations segments to support their lending activities and compensating these units for deposits gathered. The mismatch between funds provided and funds used is managed by the Treasury and Investments segment. The funds transfer pricing charged or credited are calculated using the SOFR/swap curve with term rates, adjusted for a funding spread that reflects the Corporation’s cost of funds. The methodology, which is performed based on matched maturity funding, ensures a market-based allocation of funding costs and credits, impacting segment profitability by aligning internal pricing with external market conditions. 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 the BVI, including commercial and consumer banking services. Prior period segment results have been recast to reflect certain refinements made to enhance internal reporting described in Note 25 – “Segment Information” to the audited consolidated financial statements included in the 2024 Annual Report on Form 10-K. Also, see Note 1 – “Nature of Business and Summary of Significant Accounting Policies” to the audited consolidated financial statements included in the 2024 Annual Report on Form 10-K for the accounting policies of the segments and information related to the adoption of ASU 2023-07. 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 March 31, 2025: Interest income $ 32,064 $ 105,753 $ 61,872 $ 32,638 $ 37,400 $ 7,338 $ 277,065 Net (charge) credit for transfer of funds (14,478) 75,097 (15,280) (54,717) (1,039) 10,417 - Interest expense - (37,835) (3,783) (5,580) (15,572) (1,898) (64,668) Net interest income (loss) 17,586 143,015 42,809 (27,659) 20,789 15,857 212,397 Provision for credit losses - expense (benefit) 676 20,020 2,654 (5) 849 616 24,810 Non-interest income 3,582 26,193 2,257 151 854 2,697 35,734 Non-interest expenses: Employees’ compensation and benefits 6,972 36,619 5,764 1,140 6,999 4,643 62,137 Occupancy and equipment 1,517 15,129 1,604 173 1,878 2,329 22,630 Business promotion 203 2,320 218 170 273 94 3,278 Professional fees 1,540 6,244 1,042 348 948 1,364 11,486 Taxes, other than income taxes 471 4,394 605 120 117 171 5,878 FDIC deposit insurance 415 778 668 - 237 138 2,236 Net (gain) loss on OREO operations (1,096) - 36 - - (69) (1,129) Credit and debit card processing expenses - 4,002 260 - 2 846 5,110 Other non-interest expenses (1) 972 6,733 1,412 648 711 920 11,396 Total non-interest expenses 10,994 76,219 11,609 2,599 11,165 10,436 123,022 Segment income (loss) $ 9,498 $ 72,969 $ 30,803 $ (30,102) $ 9,629 $ 7,502 $ 100,299 Average interest-earning assets $ 2,156,558 $ 4,056,039 $ 3,550,790 $ 5,730,140 $ 2,391,708 $ 426,092 $ 18,311,327 Mortgage Banking Consumer (Retail) Banking Commercial and Corporate Banking Treasury and Investments United States Operations Virgin Islands Operations Total (In thousands) Quarter ended March 31, 2024: Interest income $ 31,557 $ 104,644 $ 62,150 $ 28,058 $ 34,765 $ 7,331 $ 268,505 Net (charge) credit for transfer of funds (13,411) 66,558 (20,538) (39,630) (2,238) 9,259 - Interest expense - (38,063) (4,036) (13,118) (14,542) (2,226) (71,985) Net interest income (loss) 18,146 133,139 37,576 (24,690) 17,985 14,364 196,520 Provision for credit losses - (benefit) expense (266) 15,911 (2,926) (69) 82 (565) 12,167 Non-interest income 3,121 25,719 1,652 111 907 2,473 33,983 Non-interest expenses: Employees’ compensation and benefits 6,751 34,987 4,918 992 7,273 4,585 59,506 Occupancy and equipment 1,423 14,288 1,361 200 1,924 2,185 21,381 Business promotion 232 2,772 234 216 235 153 3,842 Professional fees 2,330 6,957 939 317 1,087 1,046 12,676 Taxes, other than income taxes 419 3,890 437 95 128 160 5,129 FDIC deposit insurance 574 1,071 917 - 311 229 3,102 Net (gain) loss on OREO operations (1,523) - 46 - - 25 (1,452) Credit and debit card processing expenses - 4,811 194 - 2 744 5,751 Other non-interest expenses (1) 817 6,601 1,505 604 629 832 10,988 Total non-interest expenses 11,023 75,377 10,551 2,424 11,589 9,959 120,923 Segment income (loss) $ 10,510 $ 67,570 $ 31,603 $ (26,934) $ 7,221 $ 7,443 $ 97,413 Average interest-earning assets $ 2,132,484 $ 3,990,853 $ 3,498,479 $ 5,900,300 $ 2,087,816 $ 413,229 $ 18,023,161 (1) Consists of communication expenses and the expense categories described in Note 19 - “Other Non-Interest Expenses,” to the audited consolidated financial statements included in the 2024 Annual Report on Form 10-K. The following table presents a reconciliation of the reportable segment financial information to the consolidated totals for the indicated periods: Quarter Ended March 31, 2025 2024 (In thousands) Average assets: Total average interest-earning assets for segments $ 18,311,327 $ 18,023,161 Average non-interest-earning assets (1) 795,775 835,138 Total consolidated average assets $ 19,107,102 $ 18,858,299 (1) Includes, among other things, non-interest-earning cash, premises and equipment, net deferred tax asset, ROU assets, and accrued interest receivable on loans and investments.

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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/exampleRef -Topic 280 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 48 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482785/280-10-55-48 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 280 -SubTopic 10 -Name Accounting Standards 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