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Stockholders' Equity and Earnings Per Common Share | 3 Months Ended
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Mar. 31, 2014
Stockholders' Equity [Abstract] |
STOCKHOLDERS' EQUITY | NOTE 1 4 — STOCKHOLDERS' EQUIT Y AND EARNINGS PER COMMON SHARE Regulatory Capital Requirements The Company (on a consolidated basis) and the Bank are subject to various regulatory capital requirements administered by federal and Puerto Rico banking agencies. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by regulators that, if undertaken, could have a direct material effect on the Company's and the Bank's financial statements. Under capital adequacy guidelines and the regulatory framework for prompt corrective action, the Company and the Bank must meet specific capital guidelines that involve quantitative measures of their assets, liabilities and certain off-balance sheet items as calculated under regulatory accounting practices. The capital amounts and classification are also subject to qualitative judgments by the regulators about components, risk weightings, and other factors. Pursuant to the Dodd-Frank Act, federal banking regulators have adopted new capital rules that bec a me effective January 1, 2014 for advanced approaches ban king organizations and will become effective January 1, 2015 for all other covered organizations (subject to certain phase-in periods through January 1, 2019) and that will replace their general risk-based capital rules, advanced approaches rule, market risk rule, and leverage rules. Quantitative measures established by regulation to ensure capital adequacy currently require the Company and the Bank to maintain minimum amounts and ratios (set forth in the following table) of total and Tier 1 capital (as defined in the regulations) to risk-weighted assets (as defined in the regulations) and of Tier 1 capital to average total assets (as defined in the regulations). As of March 31, 2014 and December 31, 20 1 3, the Company and the Bank met all capital adequacy requirements to which they are subject. As of March 3 1, 201 4 and December 31, 201 3, the Bank i s “well capitalized” under the regulatory framework for prompt corrective action. To be categorized as “well capitalized,” an institution must maintain minimum total risk-based, Tier 1 risk-based and Tier 1 leverage ratios as set forth in the following tables. The Company's and the Bank's actual capital a mounts and ratios as of March 31, 201 4 and December 31, 201 3 are as follows
|  |  |  |  |  | Minimum Capital |  | Minimum to be Well
| Actual |  | Requirement |  | Capitalized
| Amount |  | Ratio |  | Amount |  | Ratio |  |  | Amount | Ratio
| (Dollars in thousands)
Company Ratios |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of March 31, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets | $ | 836,168 |  | 16.56% |  | $ | 404,054 |  | 8.00% |  | $ | 505,067 |  | 10.00%
Tier 1 capital to risk-weighted assets | $ | 745,619 |  | 14.76% |  | $ | 202,027 |  | 4.00% |  | $ | 303,040 |  | 6.00%
Tier 1 capital to average total assets | $ | 745,619 |  | 9.51% |  | $ | 313,594 |  | 4.00% |  | $ | 391,993 |  | 5.00%
As of December 31, 2013 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets | $ | 827,460 |  | 16.16% |  | $ | 409,514 |  | 8.00% |  | $ | 511,893 |  | 10.00%
Tier 1 capital to risk-weighted assets | $ | 736,930 |  | 14.35% |  | $ | 204,757 |  | 4.00% |  | $ | 307,136 |  | 6.00%
Tier 1 capital to average total assets | $ | 736,930 |  | 9.11% |  | $ | 324,910 |  | 4.00% |  | $ | 406,138 |  | 5.00%
|  |  |  |  |  | Minimum Capital |  | Minimum to be Well
| Actual |  | Requirement |  | Capitalized
| Amount |  | Ratio |  | Amount |  | Ratio |  | Amount |  | Ratio
| (Dollars in thousands)
Bank Ratios |  |  |  |  |  |  |  |  |  |  |  |  |  |
As of March 31, 2014 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets | $ | 805,900 |  | 16.02% |  | $ | 402,495 |  | 8.00% |  | $ | 503,119 |  | 10.00%
Tier 1 capital to risk-weighted assets | $ | 715,591 |  | 14.22% |  | $ | 201,248 |  | 4.00% |  | $ | 301,871 |  | 6.00%
Tier 1 capital to average total assets | $ | 715,591 |  | 9.18% |  | $ | 311,659 |  | 4.00% |  | $ | 389,574 |  | 5.00%
As of December 31, 2013 |  |  |  |  |  |  |  |  |  |  |  |  |  |
Total capital to risk-weighted assets | $ | 779,413 |  | 15.30% |  | $ | 407,637 |  | 8.00% |  | $ | 509,547 |  | 10.00%
Tier 1 capital to risk-weighted assets | $ | 688,350 |  | 13.51% |  | $ | 203,819 |  | 4.00% |  | $ | 305,728 |  | 6.00%
Tier 1 capital to average total assets | $ | 688,350 |  | 8.54% |  | $ | 322,395 |  | 4.00% |  | $ | 402,993 |  | 5.00%
Additional paid-in capital Additional paid-in capital represents contributed capital in excess of par value of common and preferred stock net of costs of the issuance. As of March 31, 2014, accumulated issuance costs charged against additional paid in capital amounted to $10.1 million and $13.6 million for preferred and common stock, respectively. Earnings per Common Share The calculation of earnings per common share for the quarters ended March 3 1, 201 4 and 201 3 is as follows:
| Quarter Ended March 31,
| 2014 |  | 2013
| (In thousands, except per share data)
Net income | $ | 23,747 |  | $ | 21,192
Less: Dividends on preferred stock |  |  |  |  |
Non-Convertible Preferred Stock (Series A, B, and D) |  | (1,628) |  |  | (1,628)
Convertible preferred stock (Series C) |  | (1,837) |  |  | (1,837)
Income available to common shareholders | $ | 20,282 |  | $ | 17,727
Effect of assumed conversion of the Convertible Preferred Stock |  | 1,837 |  |  | 1,837
Income available to common shareholders assuming conversion | $ | 22,119 |  | $ | 19,564
Weighted average common shares and share equivalents: |  |  |  |  |
Average common shares outstanding |  | 45,329 |  |  | 45,595
Effect of dilutive securities: |  |  |  |  |
Average potential common shares-options |  | 131 |  |  | 159
Average potential common shares-assuming conversion of ' ' convertible preferred stock |  | 7,138 |  |  | 7,138
Total weighted average common shares outstanding ' 'and equivalents |  | 52,598 |  |  | 52,892
Earnings per common share - basic | $ | 0.45 |  | $ | 0.39
Earnings per common share - diluted | $ | 0.42 |  | $ | 0.37
In computing diluted earnings per common share, the 84,000 shares of convertible preferred s tock, which remain outstanding at March 3 1, 2014, with a conversion rate, subject to certain conditions, of 84.9798 shares of common stock per share, were included as average potential common shares from the date they were issued and outstanding. Moreover, in computing diluted earnings per common share, the dividends declared during the quarters ended March 31, 2014 and 2013 on the convertible preferred s tock were added back as income available to common shareholders. For the quarters ended March 31, 2014 and 2013, weighted-average stock options with an anti-dilutive effect on earnings per share not included in the calculation amounted to 2 54,662, and 653,843, respectively Treasury Stock Under the Company's current stock repurchase program it is authorized to purchase in the open market up to $70 million of its outstanding shares of common stock, of which approximately $23.1 million of authority remains. The shares of common stock repurchased are to be held by the Company as treasury shares. During the quarter ended March 31, 2014, the Company purchased 707,400 shares under this program for a total of $10.4 million, at an average price of $1 4.6 6 per share. There were no repurchases during 2013. The following table presents the shares repurchased for each month in the quarter ended March 31, 2014, e xcluding the month ended March 31, 2014, during which no shares were purchased as part of the stock repurchase program:
| Total number of |  |  |  |  | Dollar amount of
| shares purchased as |  | Average |  | shares repurchased
|  | part of stock |  | price paid |  | (excluding
| repurchase programs |  | per share |  | commissions paid)
|  |  |  |  |  |  |  | (In thousands)
Period |  |  |  |  |  |  |  |
January 2014 |  | 57,700 |  | $ | 14.73 |  | $ | 850
February 2014 |  | 649,700 |  | $ | 14.66 |  | $ | 9,522
Quarter ended March 31, 2014 |  | 707,400 |  |  | 14.66 |  |  | 10,372
The number of shares that may yet be purchased under the $70 million program is estimated at 1,341,00 2 and was calculated by divid ing the remaining balance of $2 3.1 million by $17.19 (closing price of the Company common stock at Ma rch 31, 2014). The Company did not purchase any shares of its common stock other than through its publicly announced stock repurchase program during the quarter ended March 31, 2014. The activity in connection with common shares held in treasury by the Company for quarter s ended March 31, 2014 and 2013 is set forth below:
| Quarter Ended March 31,
| 2014 |  | 2013
|  |  | Dollar |  |  |  | Dollar
| Shares |  | Amount |  | Shares |  | Amount
| (In thousands, except shares data)
Beginning of year | 7,030,101 |  | $ | 80,642 |  | 7,090,597 |  | $ | 81,275
Common shares used upon lapse of restricted stock units | (27,752) |  |  | (292) |  | (33,600) |  |  | (351)
Common shares repurchased as part of the stock repurchase program | 707,400 |  |  | 10,393 |  | - |  |  | -
Common shares used to match defined contribution plan, net | - |  |  | - |  | (7,318) |  |  | (77)
End of year | 7,709,749 |  | $ | 90,743 |  | 7,049,679 |  | $ | 80,847
Accumulated Other Comprehensive Income Accumulated other comprehensive income, net of income tax, as of March 31, 2014 and December 31, 201 3 consisted of:
| March 31, |  | December 31,
| 2014 |  | 2013
| (In thousands)
Unrealized gain on securities available-for-sale which are not other-than-temporarily impaired | $ | 18,464 |  | $ | 13,267
Income tax effect of unrealized gain on securities available-for-sale |  | (2,429) |  |  | (1,834)
Net unrealized gain on securities available-for-sale which are not other-than-temporarily impaired |  | 16,035 |  |  | 11,433
Unrealized loss on cash flow hedges |  | (10,529) |  |  | (10,907)
Income tax effect of unrealized loss on cash flow hedges |  | 2,516 |  |  | 2,665
Net unrealized loss on cash flow hedges |  | (8,013) |  |  | (8,242)
Accumulated other comprehensive income, net of taxes | $ | 8,022 |  | $ | 3,191
The following table presents changes in accumulated other comprehensive income by component, ne t of taxes, for the quarter s ended March 31, 201 4 and 2013:
| Quarter Ended March 31,
| 2014 |  | 2013
| Net unrealized |  | Net unrealized |  | Accumulated |  | Net unrealized |  | Net unrealized |  | Accumulated
| gains on |  | loss on |  | other |  | gains on |  | loss on |  | other
| securities |  | cash flow |  | comprehensive |  | securities |  | cash flow |  | comprehensive
| available-for-sale |  | hedges |  | income |  | available-for-sale |  | hedges |  | income
| (In thousands) |  | (In thousands)
Beginning balance | $ | 11,433 |  | $ | (8,242) |  | $ | 3,191 |  | $ | 68,245 |  | $ | (12,365) |  | $ | 55,880
Other comprehensive income before reclassifications |  | 4,465 |  |  | (1,392) |  |  | 3,073 |  |  | (9,899) |  |  | (313) |  |  | (10,212)
Amounts reclassified out of accumulated other comprehensive income |  | 137 |  |  | 1,621 |  |  | 1,758 |  |  | 47 |  |  | 1,336 |  |  | 1,383
Other comprehensive income (loss) |  | 4,602 |  |  | 229 |  |  | 4,831 |  |  | (9,852) |  |  | 1,023 |  |  | (8,829)
Ending balance | $ | 16,035 |  | $ | (8,013) |  | $ | 8,022 |  | $ | 58,393 |  | $ | (11,342) |  | $ | 47,051
The following table presents reclassifications out of accumulated other comprehensive income for the quarter s ended March 31, 201 4 and 2013:
|  |  |  |  |  |  | Affected Line Item in
| Quarter ended March 31, |  | Consolidated Statement
| 2014 |  | 2013 |  | of Operations
| (In thousands) |  |
Cash flow hedges: |  |  |  |  |  |  |
Interest-rate contracts | $ | 1,621 |  | $ | 1,336 |  | Net interest expense
Available-for-sale securities: |  |  |  |  |  |  |
Residual tax effect from OIB's change in applicable tax rate |  | 137 |  |  | 47 |  | Income tax expense
| $ | 1,758 |  | $ | 1,383 |  |

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- Definition The entire disclosure for accounts comprising shareholders' equity, comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income, and compensation-related costs for equity-based compensation. Includes, but is not limited to, disclosure of policies, compensation plan details, equity-based arrangements to obtain goods and services, deferred compensation arrangements, and employee stock purchase plan details. + References No definition available. + Details
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