Stockholders' Equity

9 Months Ended

Sep. 30, 2015

NOTE 16 – STOCKHOLDERS’ EQUITY

Additional Paid-in Capital

Additional paid-in capital represents contributed capital in excess of par value of common and preferred stock net of the costs of issuance. As of September 30, 2015 and December 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.

Legal Surplus

The Puerto Rico Banking Act requires that a minimum of 10% of the Bank’s net income or loss for the year be transferred to a reserve fund until such fund (legal surplus) equals the total paid in capital on common and preferred stock. At September 30, 2015 and December 31, 2014, the Bank’s legal surplus amounted to $70.4 million and $70.5 million, respectively. The amount transferred to the legal surplus account is not available for the payment of dividends to shareholders.

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 $7.7 million of authority remains. The shares of common stock repurchased are to be held by the Company as treasury shares. During the nine-month period ended September 30, 2015 the Company purchased 803,985 shares under this program for a total of $8.9 million, at an average price of $11.10 per share. During the nine-month period ended September 30, 2014 the Company purchased 707,500 shares at an average price of $14.66 per share.

The number of shares that may yet be purchased under the $70 million program is estimated at 885,550 and was calculated by dividing the remaining balance of $7.7 million by $8.73 (closing price of the Company common stock at September 30, 2015). The Company did not purchase any shares of its common stock during the nine-month periods ended September 30, 2015 or 2014, other than through its publicly announced stock repurchase program.

The activity in connection with common shares held in treasury by the Company for the nine-month periods ended September 30, 2015 and 2014 is set forth below:

	Nine-Month Period Ended September 30,
	2015			2014
		Dollar			Dollar
	Shares	Amount		Shares	Amount
	(In thousands, except shares data)
Beginning of period	8,012,254	$	97,070	7,030,101	$	80,642
Common shares used upon lapse of restricted stock units	(58,279)		(641)	(36,294)		(384)
Common shares repurchased as part of the stock repurchase program	803,985		8,950	707,500		10,394
End of period	8,757,960	$	105,379	7,701,307	$	90,652