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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2023

Income Tax Disclosure [Abstract]

Schedule of Components of Income Tax Expense (Benefit)

The components of income tax expense for 2023, 2022, and 2021 were as follows:

			Year Ended December 31,
			2023						2022						2021
			(In thousands)
Current income tax expense			$	16,027					$	16,740					$	4,836
Deferred income tax expense			67,349						61,126						63,616
Total income tax expense			$	83,376					$	77,866					$	68,452

Schedule of Effective Income Tax Rate Reconciliation

OFG’s income tax expense differs from amounts computed by applying the applicable statutory rate to income before income taxes as follows:

			Year Ended December 31,
			2023												2022												2021
			Amount						Rate						Amount						Rate						Amount						Rate
			(Dollars in thousands)
Income tax expense at statutory rates			$	99,468					37.50		%				$	91,539					37.50		%				$	80,476					37.50		%
Tax of exempt income, net			(12,201)						-4.60		%				(11,523)						-4.72		%				(9,489)						-4.42		%
Disallowed net operating loss carryover			(350)						-0.13		%				(267)						(0.11)		%				(179)						(0.08)		%
Change in valuation allowance			(1,554)						-0.59		%				(502)						(0.21)		%				803						0.37		%
Unrecognized tax benefits, net			69						0.03		%				69						0.03		%				70						0.03		%
Capital gain at preferential rate			472						0.18		%				(787)						-0.32		%				(3)						—		%
Tax rate difference (ordinary vs capital)			(817)						-0.31		%				(247)						-0.10		%				(480)						-0.22		%
Return to provision adjustments			(721)						-0.27		%				(407)						-0.17		%				(933)						-0.43		%
Difference in tax rates due to multiple jurisdictions			(963)						-0.36		%				—						—		%				187						0.09		%
Other items, net			(27)						-0.02		%				(9)						—		%				(2,000)						-0.94		%
Income tax expense			$	83,376					31.43		%				$	77,866					31.90		%				$	68,452					31.90		%

Schedule of Income Tax Contingencies

The following table presents a reconciliation of unrecognized tax benefits:

			Year Ended December 31,
			2023						2022						2021
			(In thousands)
Balance at beginning of year			$	867					$	798					$	728
Additions for tax positions of prior years			69						69						70
Balance at end of year			$	936					$	867					$	798

Schedule of Deferred Tax Assets and Liabilities

Significant components of OFG’s deferred tax assets and liabilities as of December 31, 2023, and 2022 were as follows:

												December 31,
												2023									2022
												(In thousands)
Deferred tax assets:
Allowance for credit losses and other reserves															$	58,612					$	57,273
Scotiabank PR discount															463						1,453
Loans and other real estate valuation adjustment															1,905						2,313
Deferred loan charge-offs															16,147						72,376
Net operating loss carry forwards															6,548						9,022
Alternative minimum tax															13,553						14,467
Unrealized net loss on available-for-sale securities															11,525						16,422
Goodwill															3,542						10,252
Acquired portfolio															37,374						45,761
Other assets allowances															1,692						1,538
Other deferred tax assets															16,344						16,570
Total gross deferred tax asset															167,705						247,447
Less: valuation allowance															(7,589)						(9,143)
Net gross deferred tax assets															160,116						238,304
Deferred tax liabilities:
Acquired loans tax basis															(137,143)						(137,195)
FDIC-assisted Eurobank acquisition, net															(5,481)						(5,760)
Customer deposit and customer relationship intangibles															(4,943)						(7,314)
Building valuation adjustment															(6,104)						(6,540)
Unrealized net gain included in other comprehensive income															—						(152)
Servicing asset															(15,516)						(16,041)
Other deferred tax liabilities															(8,450)						(9,817)
Total gross deferred tax liabilities															(177,637)						(182,819)
Net deferred tax (liability) asset															$	(17,521)					$	55,485

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Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of the components of net deferred tax asset or liability recognized in an entity's statement of financial position, including the following: the total of all deferred tax liabilities, the total of all deferred tax assets, the total valuation allowance recognized for deferred tax assets.

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Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations.

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Tabular disclosure for tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities and other income tax contingencies. Includes, but is not limited to, interest and penalties, reconciliation of unrecognized tax benefits, unrecognized tax benefits that would affect the effective tax rate, tax years that remain subject to examination by tax jurisdictions, and information about positions for which it is reasonably possible that amounts unrecognized will significantly change within 12 months.

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