XML 41 R30.htm IDEA: XBRL DOCUMENT v3.24.3
BUSINESS SEGMENTS
 9 Months Ended
Sep. 30, 2024
Segment Reporting [Abstract]  
BUSINESS SEGMENTS BUSINESS SEGMENTS
OFG segregates its businesses into the following segments of business: Banking, Wealth Management, and Treasury. Management established the reportable segments based on the internal reporting used to evaluate performance and to assess where to allocate resources. Other factors such as OFG’s organization, nature of its products, distribution channels and economic characteristics of the products were also considered in the determination of the reportable segments. OFG measures the performance of these segments based on pre-established goals of different financial parameters such as net income, net interest income, loan production, and fees generated. OFG’s methodology for allocating non-interest expenses among segments is based on several factors such as revenue, employee headcount, occupied space, dedicated services or time, among others. These factors are reviewed on a periodic basis and may change if the conditions warrant.

Banking includes the Bank’s branches and traditional banking products such as deposits and commercial, consumer, auto, and mortgage loans. Mortgage banking activities are carried out by the Bank’s mortgage banking division, whose principal activity is to originate mortgage loans for OFG’s own portfolio. As part of its mortgage banking activities, OFG may sell loans directly into the secondary market or securitize conforming loans into mortgage-backed securities.

Wealth Management is comprised of the Bank’s trust division, Oriental Financial Services, Oriental Insurance, and OFG Reinsurance. The core operations of this segment are financial planning, securities brokerage services, investment advisory services, insurance, corporate and individual trust and retirement services.

The Treasury segment encompasses all of OFG’s asset/liability management activities, such as purchases and sales of investment securities, interest rate risk management, and borrowings. Intersegment sales and transfers, if any, are accounted for as if the sales or transfers were to third parties, that is, at current market prices.
Following are the results of operations and the selected financial information by operating segment for the quarters and nine-month periods ended September 30, 2024 and 2023:
Quarter Ended September 30, 2024
BankingWealth
Management		TreasuryTotal Major
Segments		EliminationsConsolidated
Total
(In thousands)
Interest income$155,922 $6 $34,145 $190,073 $(1,043)$189,030 
Interest expense(37,990)— (4,208)(42,198)1,043 (41,155)
Net interest income117,932 6 29,937 147,875 — 147,875 
Provision for (recapture of) credit losses21,427 — (68)21,359 — 21,359 
Non-interest income 19,117 7,750 1 26,868 — 26,868 
Non-interest expenses(86,753)(4,016)(831)(91,600)— (91,600)
Intersegment revenue387 — — 387 (387)— 
Intersegment expenses— (224)(163)(387)387 — 
Income before income taxes29,256 3,516 29,012 61,784 — $61,784 
Income tax expense 14,742 2 40 14,784 — 14,784 
Net income$14,514 $3,514 $28,972 $47,000 $— $47,000 
Total assets$9,549,261 $36,779 $3,151,462 $12,737,502 $(1,276,120)$11,461,382 
Nine-Month Period Ended September 30, 2024
BankingWealth
Management		TreasuryTotalEliminationsConsolidated
Total
(In thousands)
Interest income$462,598 $19 $100,571 $563,188 $(3,074)$560,114 
Interest expense(111,493)— (12,393)(123,886)3,074 (120,812)
Net interest income351,105 19 88,178 439,302 — 439,302 
Provision for (recapture of) credit losses52,241 — (180)52,061 — 52,061 
Non-interest income, net
66,905 22,779 8 89,692 — 89,692 
Non-interest expenses(260,249)(13,161)(2,562)(275,972)— (275,972)
Intersegment revenue1,226 — — 1,226 (1,226)— 
Intersegment expenses— (734)(492)(1,226)1,226 — 
Income before income taxes$106,746 $8,903 $85,312 $200,961 $— $200,961 
Income tax expense53,004 10 124 53,138 — 53,138 
Net income$53,742 $8,893 $85,188 $147,823 $— $147,823 
Total assets$9,549,261 $36,779 $3,151,462 $12,737,502 $(1,276,120)$11,461,382 
Eliminations include interest income and expense for a time deposit opened by the Bank in Oriental Overseas, an international banking entity organized and licensed under Puerto Rico law, which operates as a unit within the Bank. The time deposit with a balance of $277.4 million and $308.9 million at September 30, 2024 and 2023, respectively, to fund Oriental Overseas operations is included in the Treasury Segment with its corresponding interest expense, and the related interest income is included in the Banking Segment, and are eliminated in the consolidation. Interest income is accrued on the unpaid principal balance. The decrease in interest income and interest expense from the prior year period was mainly as a result of lower interest rate and average balance.
Quarter Ended September 30, 2023
BankingWealth
Management		TreasuryTotal Major
Segments		EliminationsConsolidated
Total
(In thousands)
Interest income$145,667 $8 $23,905 $169,580 $(3,872)$165,708 
Interest expense(20,662)— (7,131)(27,793)3,872 (23,921)
Net interest income125,005 8 16,774 141,787 — 141,787 
Provision for credit losses16,371 — 59 16,430 — 16,430 
Non-interest income23,211 7,487 1 30,699 — 30,699 
Non-interest expenses(85,536)(3,778)(844)(90,158)— (90,158)
Intersegment revenue487 — — 487 (487)— 
Intersegment expenses— (337)(150)(487)487 — 
Income before income taxes46,796 3,380 15,722 65,898 — 65,898 
Income tax expense20,994 (4)35 21,025 — 21,025 
Net income$25,802 $3,384 $15,687 $44,873 $— $44,873 
Total assets$8,742,283 $34,380 $2,523,536 $11,300,199 $(1,043,061)$10,257,138 
Nine-Month Period Ended September 30, 2023
BankingWealth
Management		TreasuryTotalEliminationsConsolidated
Total
(In thousands)
Interest income$418,091 $19 $67,872 $485,982 $(13,301)$472,681 
Interest expense$(48,867)$— $(19,787)$(68,654)$13,301 $(55,353)
Net interest income$369,224 $19 $48,085 $417,328 $— $417,328 
Provision for credit losses$40,828 $— $91 $40,919 $— $40,919 
Non-interest income, net
$68,190 $22,631 $(1,148)$89,673 $— $89,673 
Non-interest expenses$(254,777)$(11,871)$(2,618)$(269,266)$— $(269,266)
Intersegment revenue$1,610 $— $— $1,610 $(1,610)$— 
Intersegment expenses$— $(1,096)$(514)$(1,610)$1,610 $— 
Income before income taxes$143,419 $9,683 $43,714 $196,816 $— $196,816 
Income tax expense$61,463 $16 $62 $61,541 $— $61,541 
Net income$81,956 $9,667 $43,652 $135,275 $— $135,275 
Total assets$8,742,283 $34,380 $2,523,536 $11,300,199 $(1,043,061)$10,257,138