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What changed in POPULAR, INC.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of POPULAR, INC.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+1027 added−1080 removedSource: 10-K (2026-03-02) vs 10-K (2025-03-03)

Top changes in POPULAR, INC.'s 2025 10-K

1027 paragraphs added · 1080 removed · 789 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

90 edited+29 added−28 removed155 unchanged
Biggest changeOur programs seek to ensure that healthcare is both accessible and affordable for our employees, with Popular covering up to 80% of health insurance premiums, a figure that surpasses regional benchmarks. In 2024, we prioritized mental health by emphasizing the importance of addressing our employees’ emotional needs and launching an internal campaign featuring short videos on wellness.
Biggest changeAccordingly, the Corporation offers a comprehensive health and wellness program that includes medical, pharmacy, vision, and dental insurance, as well as additional wellness initiatives. Our programs are designed to ensure that healthcare is both accessible and affordable for our employees, with Popular covering up to 78% of health insurance premiums, a figure that surpasses regional benchmarks.
We operate in two principal markets: ● Puerto Rico: We provide retail, mortgage and commercial banking services through our principal banking subsidiary, Banco Popular de Puerto Rico (“Banco Popular” or “BPPR”), as well as auto and equipment leasing and financing, broker-dealer and insurance services through specialized subsidiaries.
We operate in two principal markets: ● Puerto Rico: We provide retail, mortgage and commercial banking services, as well as auto and equipment leasing and financing through our principal banking subsidiary, Banco Popular de Puerto Rico (“Banco Popular” or “BPPR”), and broker- dealer and insurance services through specialized subsidiaries.
Via the “Investor Relations” link at our website, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to such reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available, free of charge, as soon as reasonably practicable after such forms are electronically filed with, or furnished to, the SEC.
Via the “Investor Relations” link at our website, our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to such reports filed or furnished 23 pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available, free of charge, as soon as reasonably practicable after such forms are electronically filed with, or furnished to, the SEC.
It is Federal Reserve Board policy that bank holding companies generally should pay dividends on common stock only out of net income available to common shareholders over the past year and only if the prospective rate of earnings retention appears consistent with the organization’s current and expected future capital needs, asset quality and overall financial condition.
It is Federal Reserve Board policy that bank holding companies generally should pay dividends on common stock only out 17 of net income available to common shareholders over the past year and only if the prospective rate of earnings retention appears consistent with the organization’s current and expected future capital needs, asset quality and overall financial condition.
Among other matters, the Capital Rules: (i) impose a capital measure called “Common Equity Tier 1” (“CET1”) and the related regulatory capital ratio of CET1 to risk-weighted assets; (ii) specify that Tier 1 capital consists of CET1 and “Additional Tier 1 capital” instruments meeting certain revised requirements; and (iii) mandate that most deductions/adjustments to regulatory capital 15 measures be made to CET1 and not to the other components of capital.
Among other matters, the Capital Rules: (i) impose a capital measure called “Common Equity Tier 1” (“CET1”) and the related regulatory capital ratio of CET1 to risk-weighted assets; (ii) specify that Tier 1 capital consists of CET1 and “Additional Tier 1 capital” instruments meeting certain revised requirements; and (iii) mandate that most deductions/adjustments to regulatory capital measures be made to CET1 and not to the other components of capital.
If the company does not return to compliance within 180 days, the Federal Reserve Board may extend the agreement or may order the company to divest its subsidiary banks or the company may discontinue, or divest investments in companies engaged in, activities permissible only for a bank holding company that has elected to be treated as a financial holding company.
If the company does not return to 18 compliance within 180 days, the Federal Reserve Board may extend the agreement or may order the company to divest its subsidiary banks or the company may discontinue, or divest investments in companies engaged in, activities permissible only for a bank holding company that has elected to be treated as a financial holding company.
Department of the Treasury to promulgate priorities for anti-money laundering and countering the financing of terrorism policy; requires the development of standards for testing technology and internal processes for BSA compliance; expands enforcement- and investigation-related authority, including a significant expansion in the available sanctions for certain BSA violations; and expands BSA whistleblower incentives and 19 protections.
Department of the Treasury to promulgate priorities for anti-money laundering and countering the financing of terrorism policy; requires the development of standards for testing technology and internal processes for BSA compliance; expands enforcement- and investigation-related authority, including a significant expansion in the available sanctions for certain BSA violations; and expands BSA whistleblower incentives and protections.
However, we can provide no assurance as to the effectiveness of these efforts on our future business or results of operations, and as to our continued ability to anticipate and adapt to changing conditions, and to sufficientl y improve our services and/or banking products, in order to successfully compete in our primary service areas.
However, we can provide no assurance as to the effectiveness of these efforts on our future business or results of operations, and as to our continued ability to anticipate and adapt to changing 10 conditions, and to sufficientl y improve our services and/or banking products, in order to successfully compete in our primary service areas.
On July 6, 2023, the SEC adopted new rules that would require registrants, such as Popular, to (i) report material 21 cybersecurity incidents on Form 8-K and, (ii) disclose in Annual Report on Form 10-K cybersecurity policies and procedures and governance practices, including at the board and management levels.
On July 6, 2023, the SEC adopted new rules that would require registrants, such as Popular, to (i) report material cybersecurity incidents on Form 8-K and, (ii) disclose in Annual Report on Form 10-K cybersecurity policies and procedures and governance practices, including at the board and management levels.
In commercial and construction loans, certain exceptions may be approved under certain circumstances, including (i) when past 10 due status is administrativ e in nature, such as expiration of a loan facility before the new documentatio n is executed, and not as a result of paymen t or credit issues; (ii) to improve our collateral position or otherwise maximize recovery or mitigate potential future losses; and (iii) with respect to certain entities that, although related through common ownership, are not cross defaulted nor cross-collateralized and are performing satisfactorily under their respective loan facilities.
In commercial and construction loans, certain exceptions may be approved under certain circumstances, including (i) when past due status is administrativ e in nature, such as expiration of a loan facility before the new documentatio n is executed, and not as a result of paymen t or credit issues; (ii) to improve our collateral position or otherwise maximize recovery or mitigate potential future losses; and (iii) with respect to certain entities that, although related through common ownership, are not cross 9 defaulted nor cross-collateralized and are performing satisfactorily under their respective loan facilities.
Popular, BPPR and PB are therefore required to maintain such additional capital conservation buffer of 2.5% of CET1, effectively resulting in minimum ratios of (i) CET1 to risk-weighted assets of at least 7%, (ii) Tier 1 capital to risk-weighted assets of at least 8.5%, and (iii) Total capital to risk-weighted assets of at least 10.5%.
Popular, BPPR and PB are therefore required to maintain such additional capital conservation buffer of 2.5% of CET1, effectively resulting in minimum ratios of (i) CET1 to risk-weighted assets of at least 7%, (ii) Tier 1 capital to risk-weighted assets of at least 8.5%, and (iii) Total capital to 15 risk-weighted assets of at least 10.5%.
If the reserve fund is not sufficient to cover such balance in whole or in part, the outstanding amount must be charged against the capital account and no dividend may be declared until capital has been restored to its original amount and the reserve fund to 20% of the original capital.
If the statutory reserve fund is not sufficient to cover such balance in whole or in part, the outstanding amount must be charged against the capital account and no dividend may be declared until capital has been restored to its original amount and the statutory reserve fund to 20% of the original capital.
Section 27 of the Banking Law also provides that when the expenditures of a bank are greater than its receipts, the excess of the former over the latter must be charged against the undistributed profits of the bank, and the balance, if any, must be charged against the reserve fund.
Section 27 of the Banking Law also provides that when the expenditures of a bank are greater than its receipts, the excess of the former over the latter must be charged against the undistributed profits of the bank, and the balance, if any, must be charged against the statutory reserve fund.
The FDIC, as required under the Federal Deposit Insurance Act (“FDIA”), established a plan in September 2020 to restore the DIF reserve ratio to meet or exceed the statutory minimum of 1.35 percent within eight years.
The FDIC, as required under the Federal Deposit Insurance Act 14 (“FDIA”), established a plan in September 2020 to restore the DIF reserve ratio to meet or exceed the statutory minimum of 1.35 percent within eight years.
The FDIC estimated in approving the rule that those assessed losses total approximately $16.3 billion. The rule provides that this loss estimate will be periodically adjusted, which will affect the amount of the special assessment.
The FDIC estimated in approving the rule that those assessed losses total $16.3 billion. The rule provides that this loss estimate will be periodically adjusted, which will affect the amount of the special assessment.
Multifamily loans, in certain cases, result from the conversion of the Bank’s construction financing to permanent financing and are repaid through the cash flow, sale or refinance of the properties. 8 (2) Mortgage.
Multifamily loans, in certain cases, result from the conversion of the Bank’s construction financing to permanent financing and are repaid through the cash flow, sale or refinance of the properties. (2) Mortgage.
Mortgage loans include residential mortgage loans to consumers for the purchase or refinancing of a residence and also include residential construction loans made to individuals for the construction of refurbishment of their residence. (3) Consumer.
Mortgage loans include residential mortgage loans to consumers for the purchase or refinancing of a residence and 7 also include residential construction loans made to individuals for the construction of refurbishment of their residence. (3) Consumer.
In the United States we continue to face substantial competitive pressure as our footprint resides in the two large metropolitan markets of New York City / Northern New Jersey and the greater Miami area. There is a large number of banks in both markets, including community, regional, and national ones, most of which have more resources than us.
In the United States we continue to face substantial competitive pressure as our footprint resides in the two large metropolitan markets of New York City / Northern New Jersey and the greater Miami area. There are a large number of banks in both markets, including community, regional, and national ones, most of which have more resources than us.
For purposes of the 18 Interstate Banking Act, BPPR is treated as a state bank and is subject to the same restrictions on interstate branching as other state banks.
For purposes of the Interstate Banking Act, BPPR is treated as a state bank and is subject to the same restrictions on interstate branching as other state banks.
In addition, certain states have enacted, or have proposed to enact, “anti-ESG” statutes, regulations or policies, including statutes that prohibit financial institutions from denying or canceling products or services to a person, or otherwise discriminating against a person in making available products or services, on the basis of social credit scores and certain other factors.
On the other hand, certain states have enacted, or have proposed to enact, “anti- ESG” statutes, regulations or policies, including statutes that prohibit financial institutions from denying or canceling products or services to a person, or otherwise discriminating against a person in making available products or services, on the basis of social credit scores and certain other factors.
As of December 31, 2024, Popular has $193 million of trust preferred securities outstanding which no longer qualify for Tier 1 capital treatment, but instead qualify for Tier 2 capital treatment. The Capital Rules also provide for a number of deductions from and adjustments to CET1.
As of December 31, 2025, Popular has $193 million of trust preferred securities outstanding which no longer qualify for Tier 1 capital treatment, but instead qualify for Tier 2 capital treatment. The Capital Rules also provide for a number of deductions from and adjustments to CET1.
In the case of loans which are secured by collateral worth at least 25% more than the amount of the loan, the maximum aggregate amount of such secured loans is increased to one third of the paid-in capital of the bank, plus its reserve fund.
In the case of loans which are secured by collateral worth at least 25% more than the amount of the loan, the maximum aggregate amount of such secured loans is increased to one third of the paid-in capital of the bank and its reserve fund.
Popular’s broker-dealer / investment adviser subsidiary, Popular Securities, LLC (“PS”) and investment advisor subsidiary Popular Asset Management LLC 13 (“PAM”) are subject to regulation by the SEC, the Financial Industry Regulatory Authority (“FINRA”), and the Securities Investor Protection Corporation, among others.
Popular’s broker-dealer / investment adviser subsidiary, Popular Securities, LLC (“PS”) and investment adviser subsidiary Popular Asset Management LLC (“PAM”) are subject to regulation by the SEC, the Financial Industry Regulatory Authority (“FINRA”), and the Securities Investor Protection Corporation, among others.
The principal competitors for BPPR include locally based commercial banks and a few large U.S. and foreign banks with operations in Puerto Rico. We also compete with specialized players in th e local financial industry that are not subjec t to the same regulatory restrictions as domestic banks and bank holdin g companies.
The principal competitors for BPPR include locally based commercial banks and a few large U.S. and foreign banks with operations in Puerto Rico. We also compete with specialized players in th e local financial industry that are not subject to the same regulatory restrictions as domestic banks and bank holdin g companies.
At December 31, 2024, we ranked among the 50 largest U.S. bank holding companies based on total assets according to information gathered and disclosed by the Federal Reserve Board.
At December 31, 2025, we ranked among the 50 largest U.S. bank holding companies based on total assets according to information gathered and disclosed by the Federal Reserve Board.
In addition, as noted above in “Regulation of Reinsurers, Insurance Producers and Agents”, Popular’s reinsurance subsidiaries are subject to licensure and regulatory supervision by the Puerto Rico Office of the Commissioner of Insurance and to insurance laws and regulations. Available Information We maintain an Internet website at www.popular.com.
In addition, as noted above in “Regulation of Reinsurers, Insurance Producers and Agents,” Popular’s reinsurance subsidiaries are subject to licensure and regulatory supervision by the Puerto Rico Office of the Commissioner of Insurance and to insurance laws and regulations. Available Information We maintain an Internet website at www.popular.com.
Trust preferred securities no longer included in Popular’s Tier 1 capital may nonetheless be included as a component of Tier 2 capital. Popular has not issued any trust preferred securities since May 19, 2010.
Trust preferred securities not included in Popular’s Tier 1 capital may nonetheless be included as a component of Tier 2 capital. Popular has not issued any trust preferred securities since May 19, 2010.
Institutions rated 2 in their last regulatory examination may include this additional component in their legal lending limit only with the previous authorization of the Office of the Commissioner.
Institutions rated 3 in their last regulatory examination may include this additional component in their legal lending limit only with the previous authorization of the Office of the Commissioner.
The proposed changes would establish a maximum permissible interchange fee of no more than 14.4 cents per transaction plus four basis points multiplied by the value of the transaction. The fraud prevention adjustment would be increased to 1.3 cents per transaction.
If adopted, the 19 proposed changes would establish a maximum permissible interchange fee of no more than 14.4 cents per transaction plus four basis points multiplied by the value of the transaction. The fraud prevention adjustment would be increased to 1.3 cents per transaction.
The proposed rule would also establish an automatic update of the interchange fee cap every other year based on a survey of debit card issuers.
The proposed changes would also establish an automatic update of the interchange fee cap every other year based on a survey of debit card issuers.
In June 2024, due to the increase in the estimate of losses, the FDIC announced that it projects that the special assessment will be collected for an additional two quarters beyond the initial eight- quarter collection period, at a lower rate.
In June 2024, due to the increase in the estimate of losses, the FDIC announced that it projected that the special assessment would be collected for an additional two quarters beyond the initial eight quarter collection period, at a lower rate.
The increased assessment is intended to improve the likelihood that the DIF reserve ratio would reach the required minimum by the statutory deadline of September 30, 2028. As of December 31, 2024, BPPR and PB had a DIF average total asset less average tangible equity assessment base of approximately $67 billion.
The increased assessment is intended to improve the likelihood that the DIF reserve ratio would reach the required minimum by the statutory deadline of September 30, 2028. As of December 31, 2025, BPPR and PB had a DIF average total asset less average tangible equity assessment base of $69 billion.
The special assessments are collected at an annual rate of approximately 13.4 basis points per year (3.36 basis points per quarter) over eight quarters, with the first assessment period having begun January 1, 2024.
The special assessments were to be collected at an annual rate of approximately 13.4 basis points per year (3.36 basis points per quarter) over eight quarters, with the first assessment period having begun January 1, 2024.
During the year ended December 31, 2024, BPPR declared cash dividends of $600 million, a portion of which was used by Popular for the payments of the cash dividends on its outstanding common stock.
During the year ended December 31, 2025, BPPR declared cash dividends of $575 million, a portion of which was used by Popular for the payments of the cash dividends on its outstanding common stock.
The credit policies also set forth the required closing documentation depending on the loan and the collateral type. Although we originat e most of our loans internally in both the Puerto Rico and mainlan d United States markets, we occasionally purchase or participate in loans originated by other financial institutions.
The credit policies also set forth the required closing documentation depending on the loan and the collateral type. Although we originate most of our loans internally in both the Puerto Rico and mainland United States markets, we occasionally purchase or participate in loans originated by other financial institutions.
California recently enacted climate-related disclosure laws requiring certain companies doing business in California to make certain climate-related disclosures, including but not limited to greenhouse gas emissions data and climate-related risks.
In 2023, California enacted climate-related disclosure laws requiring certain companies doing business in California to make certain climate-related disclosures beginning in 2026, including but not limited to greenhouse gas emissions data and climate-related risks.
As part of its responsibilities, the Talent and Compensation Committee reviews and advises management on the Corporation’s general compensation philosophy, programs and policies, and on the Corporation’s talent acquisition and development, workforce engagement succession planning and culture, among other human capital topics.
As part of its responsibilities, the Talent and Compensation Committee reviews and advises management on the Corporation’s overall compensation philosophy, programs and policies, and on the Corporation’s talent acquisition and development, workforce engagement, succession planning, and corporate culture, among other human capital matters.
At December 31, 2024, BPPR needed to obtain prior approval of the Federal Reserve Board before declaring a dividend in excess of $318 million due to its retained income, declared dividend activity and transfers to statutory reserves over the three year’s ended December 31, 2024.
At December 31, 2025, BPPR needed to obtain prior approval of the Federal Reserve Board before declaring a dividend in excess of $191 million due to its retained income, declared dividend activity and transfers to statutory reserves over the three years ended December 31, 2025.
However, approximately 55% of our loan portfolio at December 31, 2024 consisted of real estate-related loans, including residential mortgage loans, construction loans and commercial loans secured by commercial real estate. The table below presents the distribution of our loan portfolio by loan category at December 31, 2024.
However, 52% of our loan portfolio at December 31, 2025 consisted of real estate- related loans, including residential mortgage loans, construction loans and commercial loans secured by commercial real estate. The table below presents the distribution of our loan portfolio by loan category at December 31, 2025.
Significantly undercapitalized depository institutions may be subject to a number of requirements and restrictions, including orders to sell sufficient voting stock to become adequately capitalized, requirements to reduce total assets and cessation of receipt of deposits from correspondent banks.
Significantly undercapitalized depository institutions may be subject to a number of requirements and restrictions, including orders to sell sufficient voting stock to become adequately capitalized, requirements to reduce total assets and cessation of receipt of deposits from correspondent banks. Critically undercapitalized depository institutions are subject to appointment of a receiver or conservator.
An insured depository institution will be deemed to be (i) “well capitalized” if the institution has a total risk-based capital ratio of 10.0% or greater, a CET1 capital ratio of 6.5% or greater, a Tier 1 risk-based capital ratio of 8.0% or greater, and a leverage ratio of 5.0% or greater, and is not subject to any order or written directive by any such regulatory authority to meet and maintain a specific capital level for any capital measure; (ii) “adequately capitalized” if the institution has a total risk-based capital ratio of 8.0% or greater, a CET1 capital ratio of 4.5% or greater, a Tier 1 risk-based capital ratio of 6.0% or greater, and a leverage ratio of 4.0% or greater and is not “well capitalized”; (iii) “undercapitalized” if the institution has a total risk-based capital ratio that is less than 8.0%, a CET1 capital ratio less than 4.5%, a Tier 1 risk-based capital ratio of less than 6.0% or a leverage ratio of less than 4.0%; (iv) “significantly undercapitalized” if the institution has a total risk-based capital ratio of less than 6.0%, a CET1 capital ratio less than 3%, a Tier 1 risk-based capital ratio of less than 4.0% or a leverage ratio of less than 3.0%; and (v) “critically undercapitalized” if the institution’s tangible equity is equal to or less than 2.0% of average quarterly tangible assets.
A depository institution’s capital tier will depend upon how its capital levels compare with various relevant capital measures and certain other factors. 16 An insured depository institution will be deemed to be (i) “well capitalized” if the institution has a total risk-based capital ratio of 10.0% or greater, a CET1 capital ratio of 6.5% or greater, a Tier 1 risk-based capital ratio of 8.0% or greater, and a leverage ratio of 5.0% or greater, and is not subject to any order or written directive by any such regulatory authority to meet and maintain a specific capital level for any capital measure; (ii) “adequately capitalized” if the institution has a total risk-based capital ratio of 8.0% or greater, a CET1 capital ratio of 4.5% or greater, a Tier 1 risk-based capital ratio of 6.0% or greater, and a leverage ratio of 4.0% or greater and is not “well capitalized”; (iii) “undercapitalized” if the institution has a total risk-based capital ratio that is less than 8.0%, a CET1 capital ratio less than 4.5%, a Tier 1 risk-based capital ratio of less than 6.0% or a leverage ratio of less than 4.0%; (iv) “significantly undercapitalized” if the institution has a total risk-based capital ratio of less than 6.0%, a CET1 capital ratio less than 3%, a Tier 1 risk-based capital ratio of less than 4.0% or a leverage ratio of less than 3.0%; and (v) “critically undercapitalized” if the institution’s tangible equity is equal to or less than 2.0% of average quarterly tangible assets.
The banking operations of BPPR are primarily based in Puerto Rico, where BPPR has the largest retail banking franchise. ● Mainland United States: We provide retail, mortgage and commercial banking services through our New York-chartered banking subsidiary, Popular Bank (“PB” or “Popular U.S.”), which has branches in New York, New Jersey and Florida; as well as investment and insurance services, and commercial direct financing leases through specialized subsidiaries.
The banking operations of BPPR are primarily based in Puerto Rico, where BPPR has the largest retail banking franchise. ● Mainland United States: We provide retail and commercial banking services, as well as equipment leasing and financing, through our New York -chartered banking subsidiary, Popular Bank (“PB” or “Popular U.S.”), which has branches in New York, New Jersey, and Florida.
After the effect of potential base-rate adjustments, the total base assessment rate could range from 1.5 to 40 basis points on an annualized basis. In October 2022, the FDIC finalized a rule that increased initial base deposit insurance assessment rates by 2 basis points, beginning with the first quarterly assessment period of 2023.
Taking into account the adjustments the FDIC may make to the base rate, the total base assessment rate could range from 1.5 to 40 basis points on an annualized basis. In October 2022, the FDIC finalized a rule that increased initial base deposit insurance assessment rates by 2 basis points, beginning with the first quarterly assessment period of 2023.
Pursuant to an order of the Federal Reserve Board dated November 24, 1982, BPPR has been exempted from the reserve requirements of the Federal Reserve System with respect to deposits payable in Puerto Rico. Accordingly, BPPR is subject to the reserve requirement prescribed by the Banking Law. During 2024, BPPR was in compliance with the statutory reserve requirement.
Pursuant to an order of the Federal Reserve Board dated November 24, 1982, BPPR has been exempted from the reserve requirements of the Federal Reserve System with respect to deposits payable in Puerto Rico. Accordingly, BPPR is subject to the reserve requirement prescribed by Section 16 of the Banking Law.
Transactions with Affiliates BPPR and PB are subject to restrictions that limit the amount of extensions of credit and certain other “covered transactions” (as defined in Section 23A of the Federal Reserve Act) between BPPR or PB, on the one hand, and Popular, PNA or any of our other non-banking subsidiaries, on the other hand, and that impose collateralization requirements on such credit extensions.
As of December 31, 2025, Popular had total consolidated assets of $75.3 billion. 13 Transactions with Affiliates BPPR and PB are subject to restrictions that limit the amount of extensions of credit and certain other “covered transactions” (as defined in Section 23A of the Federal Reserve Act) between BPPR or PB, on the one hand, and Popular, PNA or any of our other non-banking subsidiaries, on the other hand, and that impose collateralization requirements on such credit extensions.
Refer to the Overview section of Management’s Discussion and Analysis included in this Form 10-K for information on recent significant events that have impacted or will impact our current and future operations. Human Capital Management Popular seeks to embody our purpose of “putting people at the center of progress” throughout its human capital management.
Refer to the Overview section of Management’s Discussion and Analysis included in this Form 10-K for information on recent significant events that have impacted or will impact our current and future operations. Human Capital Management Popular seeks to embody our values and behaviors throughout our human capital management practices.
Climate-Related and ESG Developments In recent years, federal, state and international lawmakers and regulators have increased their focus on financial institutions’ and other companies’ risk oversight, disclosures and practices in connection with climate change and other environmental, social and governance (“ESG”) matters.
Climate-Related and ESG Developments In recent years, certain lawmakers and regulators in and outside the United States have increased their focus on financial institutions’ and other companies’ risk oversight, disclosures and practices in connection with climate change and other environmental, social and governance (“ESG”) matters.
Incentive Compensation The Federal Reserve Board reviews, as part of its regular, risk-focused examination process, the incentive compensation arrangements of banking organizations, such as Popular, that are not “large, complex banking organizations.” Deficiencies will be incorporated into the organization’s supervisory ratings, which can affect the organization’s ability to make acquisitions and take other actions.
The Executive Order directs the Treasury Secretary and federal banking regulators to address politicized or unlawful debanking activities. 21 Incentive Compensation The Federal Reserve Board reviews, as part of its regular, risk-focused examination process, the incentive compensation arrangements of banking organizations, such as Popular, that are not “large, complex banking organizations.” Deficiencies will be incorporated into the organization’s supervisory ratings, which can affect the organization’s ability to make acquisitions and take other actions.
In 2020, federal bank regulators adopted a rule that allowed banking organizations to elect to delay temporarily the estimated effects of adopting CECL on regulatory capital until January 2022 and subsequently to phase in the effects through January 2025.
In 2020, federal bank regulators adopted a rule that allowed banking organizations to elect to delay temporarily the estimated effects of adopting the Current Expected Credit Loss (“CECL”) model of ASU 2016-13 on regulatory capital until January 2022 and subsequently to phase in the effects through January 2025.
In November 2021, the U.S. federal bank regulatory agencies issued a final rule requiring banking organizations, including Popular, PNA, BPPR and PB, to notify their primary federal banking regulator within 36 hours of determining that a “notification incident” has occurred.
If we fail to observe the regulatory guidance, we could be subject to various regulatory sanctions, including financial penalties. In November 2021, the U.S. federal bank regulatory agencies issued a final rule requiring banking organizations, including Popular, PNA, BPPR and PB, to notify their primary federal banking regulator within 36 hours of determining that a “notification incident” has occurred.
The U.S. financial regulators proposed revised rules in 2016, which have not been finalized. 22 In October 2022, the SEC adopted a final rule requiring securities exchanges to adopt rules mandating, in the case of a restatement, the recovery or “clawback” of excess incentive-based compensation paid to current or former executive officers and requiring listed issuers to disclose any recovery analysis where recovery is triggered by a restatement.
In October 2022, the SEC adopted a final rule requiring securities exchanges to adopt rules mandating, in the case of a restatement, the recovery or “clawback” of excess incentive-based compensation paid to current or former executive officers and requiring listed issuers to disclose any recovery analysis where recovery is triggered by a restatement.
Attracting, developing and retaining top talent in an environment that promotes wellness, inclusion, respect, learning and transparency are fundamental pillars of our long-term strategy. As of December 31, 2024, Popular had 9,406 employees, none of whom were represented by a collective bargaining group.
Attracting, developing, and retaining top talent in an environment that promotes wellness, inclusion, respect, continuous learning, and transparency are fundamental pillars of the Corporation’s long-term strategy. As of December 31, 2025, Popular employed 9,427 individuals, none of whom were represented by a collective bargaining group.
Section 27 of the Banking Law requires that at least ten percent (10%) of the yearly net income of BPPR be credited annually to a reserve fund. The apportionment must be done every year until the reserve fund is equal to the total of paid-in capital on common and preferred stock.
Section 27 of the Banking Law requires that at least ten percent (10%) of BPPR’s annual retained earnings be transferred 22 annually to a statutory reserve fund. The apportionment must be done every year until the reserve fund is equal to the total of paid- in capital on common and preferred stock.
Business activities that expose us to credit risk are managed within the Board of Director’s Risk Management policy, and the Credit Risk Tolerance Limits policy, which establishes limits that consider factors such as maintainin g a prudent balance of risk-taking across diversified risk types and business units, compliance with regulator y guidance, and controlling the exposure to lower credit quality assets.
Credit risk is controlled and monitored through active asset quality management, including the use of lending standards, thorough review of potential borrowers and through active asset quality administration. 8 Business activities that expose us to credit risk are managed within the Board of Director’s Risk Management policy, and the Credit Risk Tolerance Limits policy, which establishes limits that consider factors such as maintainin g a prudent balance of risk-taking across diversified risk types and business units, compliance with regulator y guidance, and controlling the exposure to lower credit quality assets.
Furthermore, our employee experience efforts are reflected in an employee loyalty score of 81%, which positions us above the 50th percentile of the Qualtrics global benchmark and above the average benchmark of the financial industry. Board Oversight in Human Capital The Talent and Compensation Committee of the Corporation’s Board of Directors has oversight responsibility for the Corporation’s human capital management.
Furthermore, our employee-experience efforts are reflected in record participation rate of 77% and a sustained employee-loyalty score of 81%, positioning us above the 50th percentile of the Qualtrics global benchmark and above the financial services industry average benchmark. 12 Board Oversight in Human Capital The Talent and Compensation Committee of the Corporation’s Board of Directors has oversight responsibility for the Corporation’s human capital management practices.
Popular was incorporated in 1984 under the laws of the Commonwealth of Puerto Rico and is the largest financial institution based in Puerto Rico, with consolidated assets of $73.0 billion, total deposits of $64.9 billion and stockholders’ equity of $5.6 billion at December 31, 2024.
Popular was incorporated in 1984 under the laws of the Commonwealth of Puerto Rico and is the largest financial institution based in Puerto Rico, with consolidated assets of $75.3 billion, total deposits of $66.2 billion and stockholders’ equity of $6.2 billion at December 31, 2025.
On December 21, 2022, the NYSDFS proposed guidance on climate-related financial risk management applicable to NYSDFS-regulated banking and mortgage organizations, including PB. The proposed guidance would address material financial risks related to climate change faced by these organizations in the context of risk assessment, risk management, and risk appetite setting.
For example, in 2023, the NYSDFS issued guidance on climate-related financial risk management applicable to NYSDFS-regulated banking and mortgage organizations, including PB. The guidance addresses material financial risks related to climate change faced by these organizations in the context of risk assessment, risk management, and risk appetite setting.
A financial institution is also expected to develop appropriate processes to enable recovery of data and business operations and address rebuilding network capabilities and restoring data if the institution or its critical service providers fall victim to this type of cyber-attack. If we fail to observe the regulatory guidance, we could be subject to various regulatory sanctions, including financial penalties.
A financial institution 20 is also expected to develop appropriate processes to enable recovery of data and business operations and address rebuilding network capabilities and restoring data if the institution or its critical service providers fall victim to this type of cyber-attack.
Construction loans are CRE loans to companies, community or homeowners’ associations, or developers used for the construction of a commercial or residential property for which repayment will be generated by the sale or permanent financing of the property. Our construction loan portfolio primarily consists of retail, residential (land and condominiums), office and warehouse product types. (5) Lease Financings.
Construction loans are CRE loans to companies or developers used for the construction of a commercial or residential property for which repayment will be generated by the sale or permanent financing of the property. Our construction loan portfolio primarily consists of residential land development, multifamily housing, and condominium projects. (5) Lease Financings.
Bank holding companies with total consolidated assets of $50 billion or more are subject to risk committee and risk management requirements. As of December 31, 2024, Popular had total consolidated assets of $73.0 billion.
Bank holding companies with total consolidated assets of $50 billion or more are subject to risk committee and risk management requirements.
The substantive obligations under the 2020 amendment to the CCPA became effective on January 1, 2023. In European Union, the General Data Protection Regulation heightens privacy compliance obligations and imposes strict standards for reporting data breaches. We expect this trend to continue and are continually monitoring developments in the jurisdictions in which we operate.
The substantive obligations under the 2020 amendment to the CCPA became effective on January 1, 2023. In the European Union, the General Data Protection Regulation heightens privacy compliance obligations and imposes strict standards for reporting data breaches. We continue to monitor these developments to comply with applicable requirements.
In no event may the total of unsecured and secured loans to any one person, firm, partnership or corporation exceed an aggregate amount of 33 1/3% of the paid-in capital and reserve fund of the bank. 23 If the institution is well capitalized and had been rated 1 in the last examination performed by the Office of the Commissioner or any regulatory agency, its legal lending limit shall also include 15% of 50% of its undivided profits and for loans secured by collateral worth at least 25% more than the amount of the loan, the capital of the bank shall also include 33 1/3% of 50% of its undivided profits.
If the institution is well capitalized and had been rated 1 or 2 in the last examination performed by the Office of the Commissioner or an applicable regulatory agency, its legal lending limit shall also include 15% of 100% of its undivided profits and for loans secured by collateral worth at least 25% more than the amount of the loan, the capital of the bank shall also include 33 1/3% of 100% of its undivided profits.
Among other things, these standards revise the Basel Committee’s standardized approach for credit risk (including by recalibrating risk weights and introducing new capital requirements for certain “unconditionally cancellable commitments,” such as unused credit card lines of credit) and provide a new standardized approach for operational risk capital. 16 Under the current U.S. capital rules, operational risk capital requirements and a capital floor apply only to Category I and Category II banking organizations and not to Popular, BPPR and PB.
Among other things, these standards revise the Basel Committee’s standardized approach for credit risk (including by recalibrating risk weights and introducing new capital requirements for certain “unconditionally cancellable commitments,” such as unused credit card lines of credit) and provide a new standardized approach for operational risk capital.
Section 17 of the Banking Law permits a bank to make loans to any one person, firm, partnership or corporation, up to an aggregate amount of fifteen percent (15%) of the paid-in capital and reserve fund of the bank. As of December 31, 2024, the legal lending limit for BPPR under this provision was approximately $349 million.
During 2025, BPPR was in compliance with the legal reserve requirement. Section 17 of the Banking Law permits a bank to make loans to any one person, firm, partnership or corporation, up to an aggregate amount of fifteen percent (15%) of the paid-in capital and reserve fund of the bank.
Refer to the Consolidated Financial Statements in this Form 10-K., Note 20 and Table 10 of Management’s Discussion and Analysis for the capital ratios of Popular, BPPR and PB under Basel III. Refer to the Consolidated Financial Statements in this Form 10-K Note 2 for more information regarding CECL.
The Corporation’s capital ratios at December 31, 2025 reflect the full phased in impact from the adoption of CECL. Refer to the Consolidated Financial Statements in this Form 10-K., Note 20 and Table 10 of Management’s Discussion and Analysis for the capital ratios of Popular, BPPR and PB under Basel III.
During 2024, BPPR was in compliance with the lending limit requirements of Section 17 of the Banking Law. Section 14 of the Banking Law authorizes a bank to conduct certain financial and related activities directly or through subsidiaries, including finance leasing of personal property and originating and servicing mortgage loans.
Section 14 of the Banking Law authorizes a bank to conduct certain financial and related activities, including finance leasing of personal property and originating and servicing mortgage loans, directly or through subsidiaries. BPPR engages in finance leasing and conducts the origination and servicing of mortgage loans through its Popular Auto and Popular Mortgage divisions, respectively.
The maximum permissible interchange fee that an issuer may receive for an electronic debit transaction is the sum of 21 cents per transaction and 5 basis points multiplied by the value of the transaction.
Interchange Fees Regulation The Federal Reserve Board has established standards for debit card interchange fees and prohibited network exclusivity arrangements and routing restrictions. The maximum permissible interchange fee that an issuer may receive for an electronic debit transaction is the sum of 21 cents per transaction and 5 basis points multiplied by the value of the transaction.
Our 40,000 square foot Development Center in San Juan, Puerto Rico and our satellite facilities in New York, South Florida, and the Virgin Islands offer year-round training sessions, activities and workshops. More than 4,100 employees participated in corporate academy voluntary courses, new employee orientations, health coordinator certifications, and manager onboarding courses.
Our 40,000 square foot development center in San Juan, Puerto Rico, and our satellite facilities in New York, South Florida, and the Virgin Islands, offer year-round training sessions, activities and workshops.
Critically undercapitalized depository institutions are subject to appointment of a receiver or conservator. 17 The capital-based prompt corrective action provisions of the FDIA apply to the FDIC-insured depository institutions such as BPPR and PB, but they are not directly applicable to holding companies such as Popular and PNA, which control such institutions.
The capital-based prompt corrective action provisions of the FDIA apply to the FDIC-insured depository institutions such as BPPR and PB, but they are not directly applicable to holding companies such as Popular and PNA, which control such institutions. As of December 31, 2025, both BPPR and PB met the quantitative requirements for ‘well capitalized’ status.
Some commercia l loan facilities are structured as lines of credit, which are mainly one year in term and therefore are required to be renewed annually. Other facilities may be restructure d or extended from time to time based upon changes in the borrower’s business needs, use of funds, timing of completion of projects and other factors.
Other facilities may be restructure d or extended from time to time based upon changes in the borrower’s business needs, use of funds, timing of completion of projects and other factors.
As a result, the Corporation’s internal mobility rate in 2024 was 44%. This included employees who applied or were selected for vacancies, were promoted, or had lateral movements. Additionally, we continued strengthening key skills across accelerated development programs focused on data science, analytics, process excellence and program management.
As a result, the Corporation’s internal mobility rate in 2025 was 47%, reflecting employees who applied for or were selected for open positions, received promotions, or made lateral moves within the organization. Additionally, we continued strengthening key skills across accelerated development programs focused on data science, agile methodologies, analytics, process efficiency, and product management.
The Federal Reserve has indicated that it expects to work with the other federal banking regulators on a revised proposal in 2025. The Capital Rules preclude certain hybrid securities, such as trust preferred securities, from inclusion in bank holding companies’ Tier 1 capital.
The federal banking regulators have subsequently indicated that they expect to issue a revised proposal, the timing and contents of which are uncertain. The Capital Rules preclude certain hybrid securities, such as trust preferred securities, from inclusion in bank holding companies’ Tier 1 capital.
The proposal would also apply “clean holding company” requirements to Category II through IV bank holding companies, which would, among other things, prohibit prohibit those holding companies from entering into derivatives and certain other financial contracts with third parties. 14 As of December 31, 2024, Popular, PNA, BPPR and PB’s total assets were below the thresholds for applicability of these rules, except that BPPR is subject to the FDIC’s resolution planning requirements applicable to insured depository institutions with more than $50 billion but less than $100 billion in assets.
As of December 31, 2025, Popular, PNA, BPPR and PB’s total assets were below the thresholds for applicability of these rules, except that BPPR is subject to the FDIC’s resolution planning requirements applicable to insured depository institutions with more than $50 billion but less than $100 billion in assets.
Credit Administration and Credit Policies Interest from our loan portfolios is our principal source of revenue. Whenever we make loans, we expose ourselves to 9 credit risk. Credit risk is controlled and monitored through active asset quality management, including the use of lending standards, thorough review of potential borrowers and through active asset quality administration.
Credit Administration and Credit Policies Interest from our loan portfolios is our principal source of revenue. Whenever we make loans, we expose ourselves to credit risk.
These courses offer instructor-led training experiences for employees to learn and apply critical core and technical skills. Our commitment to continuous learning is further supported by offering our employees access to LinkedIn Learning, which provides an extensive library of over 16,000 e-learning courses. 12 Our focus on training and development has provided internal growth opportunities to our workforce.
Our commitment to continuous learning is further supported through employee access to LinkedIn Learning, which provides an extensive library of over 16,000 e-learning courses, enabling employees to pursue self-directed learning aligned with both professional development goals and business needs. Our focus on training and development has provided internal growth opportunities for our workforce.
Succession plans for senior management are developed by the CEO and presented to the Board of Directors. Popular’s succession planning also leverages our Executive Talent Management Program to identify high-potential and high-performing managers, providing them with learning opportunities to enhance their skills and prepare them for senior management positions.
Popular’s succession planning also leverages our Executive Talent Management Program to identify high-potential and high-performing managers, providing them with targeted learning opportunities to enhance their skills and prepare them for future senior management positions. Employee Experience Popular is committed to providing an exceptional employee experience that inspires our employees to deliver outstanding service to our customers and communities.
Refer to the Credit Risk section of the MD&A included in this Form 10-K for information related to management committees and divisions with responsibilities for establishing policies and monitoring the Corporation’s credit risk. Loan extensions , renewals and restructurings Loans with satisfactory credit profiles can be extended, renewed or restructured .
When we purchase or participate in loans originated by others, we ensure that those loans meet our underwriting standards and are consistent with our risk appetite. Refer to the Credit Risk section of the MD&A included in this Form 10-K for information related to management committees and divisions with responsibilities for establishing policies and monitoring the Corporation’s credit risk.
Nurturing Well -Being: Employee Health & Financial Security Popular believes that the health and financial wellness of our employees is essential to effectively serve our customers and contribute positively to the communities where we operate. Our health and wellness program includes health, pharmacy, vision and dental insurance, as well as other wellness initiatives.
Nurturing Well -Being: Employee Health & Financial Security Popular believes that the health and financial wellness of our employees is fundamental to delivering high-quality service to our customers and contributing positively to the communities in which we operate.
Empowering Growth: Our Commitment to Talent Developmen t We are committed to fostering the continuous development and upskilling of our employees and believe this is fundamental to maintaining our competitive edge.
Empowering Growth: Our Commitment to Talent Developmen t We are committed to fostering the continuous development and upskilling of our employees and believe this is fundamental to maintaining our competitive advantage. Towards that end, Popular offers development opportunities designed to strengthen our employees’ knowledge, capabilities and skills, supporting their personal growth while enhancing Popular’s business strategies and organizational effectiveness.
Our health and wellness center received over 15,561 visits from employees during 2024. Popular also seeks to foster work-life balance by providing paid time off benefits to our employees, including community service leave, paid parental leave and flexible work arrangements. Our hybrid work model, accessible to approximately half of our workforce, underscores our commitment to flexible work environments.
Popular also seeks to foster work-life balance by offering paid time off benefits to our employees, including community service leave, paid parental leave, and flexible work arrangements.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeWe must maintain adequate liquidity and funding sources to support our operations, fund customer deposit withdrawals, repay borrowings and debt, comply with our financial obligations, fund planned capital distributions and meet regulatory requirements. The Corporation’s most significant source of funds are bank deposits, including customer deposits and brokered deposits.
Biggest changeFurthermore, actions by the rating agencies or decreases in our capital levels may have adverse effects on our liquidity and business, including by raising the cost of our obligations or affecting our ability to borrow. 33 We must maintain adequate liquidity and funding sources to support our operations, fund customer deposit withdrawals, repay borrowings and debt, comply with our financial obligations, fund planned capital distributions and meet regulatory requirements.
Although Evertec has agreed to provide certain transition assistance to us in connection with the termination of the MSA, we are ultimately dependent on their ability to provide those services in a responsive and competent manner, as well as to retain experienced personnel to provide the services.
Although Evertec has agreed to provide certain transition assistance to us in connection with the termination of the MSA, we are ultimately dependent on their ability to provide those services in a responsive and competent manner, as well as their ability to retain experienced personnel to provide the services.
A material compromise or circumvention of the security of our systems could have serious negative consequences for us, including significant disruption of our operations and those of our clients, customers and counterparties, misappropriation of confidential information of Popular or that of our clients, customers, counterparties or employees, or damage to computers or systems used by us or by our clients, customers and counterparties, and could result in violations of applicable privacy and other laws, financial loss to us or to our customers, increased regulatory scrutiny and enforcement actions, customer dissatisfaction, significant litigation exposure and harm to our reputation, all of which could have a material adverse effect on us.
A material compromise or circumvention of the security of our systems could have serious negative consequences for us, including significant disruption of our operations and those of our clients, customers and counterparties, misappropriation of 27 confidential information of Popular or that of our clients, customers, counterparties or employees, or damage to computers or systems used by us or by our clients, customers and counterparties, and could result in violations of applicable privacy and other laws, financial loss to us or to our customers, increased regulatory scrutiny and enforcement actions, customer dissatisfaction, significant litigation exposure and harm to our reputation, all of which could have a material adverse effect on us.
Certain risks particular to Evertec and our dependence on third parties are discussed under “We rely on other companies to provide key components of our business infrastructure, 28 including certain of our core financial transaction processing and information technology and security services, which exposes us to a number of operational risks that could have a material adverse effect on us” in the Operational Risks section of Item 1A in this Form 10-K.
Certain risks particular to Evertec and our dependence on third parties are discussed under “We rely on other companies to provide key components of our business infrastructure, including certain of our core financial transaction processing and information technology and security services, which exposes us to a number of operational risks that could have a material adverse effect on us” in the Operational Risks section of Item 1A in this Form 10-K.
While management expects that we would be able to meet any additional collateral requirements if and when needed, the requirements to post collateral under certain agreements or the loss of custodian funds could reduce our liquidity resources and impact our results of operations. As a holding company, we depend on dividends and distributions from our subsidiaries for liquidity.
While management expects that we would be able to meet any additional collateral requirements if and when needed, the requirements to post collateral under certain agreements or the loss of custodian funds could reduce our liquidity resources and impact our results of operations. As a bank holding company, we depend on dividends and distributions from our subsidiaries for liquidity.
We have significant exposure to borrowers in certain economic sectors, such as residential and commercial real estate, hospitality and healthcare. Challenging economic or market conditions that affect the industries or types of clients to which we have significant exposure could result in higher credit losses and adversely affect our business, financial condition, liquidity, results of operations or capital position.
We have significant exposure to borrowers in certain economic sectors, such as residential and commercial real estate, 25 hospitality and healthcare. Challenging economic or market conditions that affect the industries or types of clients to which we have significant exposure could result in higher credit losses and adversely affect our business, financial condition, liquidity, results of operations or capital position.
The most significant cyber-attack risks that we or our 27 critical service providers may face include, but are not limited to, e-fraud, denial-of-service (DDoS), ransomware, computer intrusion and the exploitation of software zero-day vulnerabilities that might result in disruption of services, in the exposure or loss of customer or proprietary data, and significant financial loss.
The most significant cyber-attack risks that we or our critical service providers may face include, but are not limited to, e-fraud, denial-of-service (DDoS), ransomware, computer intrusion and the exploitation of software zero-day vulnerabilities that might result in disruption of services, in the exposure or loss of customer or proprietary data, and significant financial loss.
For example, during the second quarter of 2022, BPPR entered into a settlement agreement with OFAC with respect to certain transactions processed on behalf of two employees of the Government of Venezuela, in apparent violation of U.S. sanctions against Venezuela. Popular agreed to pay approximately $256,000 to settle the apparent violations, which had been self-disclosed to OFAC.
For example, during the second quarter of 2022, BPPR entered into a settlement agreement with OFAC with respect to certain transactions processed on behalf of two employees of the Government of Venezuela, in apparent violation of U.S. sanctions against Venezuela. Popular agreed to pay $256,000 to settle the apparent violations, which had been self-disclosed to OFAC.
Our credit ratings were reduced substantially in 2009 and, although one of the three major rating agencies upgraded our senior unsecured rating back to “investment grade” during 2021, the remaining two rating agencies have not upgraded their current “non-investment grade” rating. The market for non- 34 investment grade securities is much smaller and less liquid than for investment grade securities.
Our credit ratings were reduced substantially in 2009 and, although one of the three major rating agencies upgraded our senior unsecured rating back to “investment grade” during 2021, the remaining two rating agencies have not upgraded their current “non-investment grade” rating. The market for non- investment grade securities is much smaller and less liquid than for investment grade securities.
Factors that may be considered a change in circumstances, indicating that the carrying value of the goodwill or amortizable intangible assets may not be recoverable, include a decline in Popular’s stock price related to a deterioration in global or local economic conditions, declines in 37 our market capitalization, reduced future earnings estimates, and interest rate changes.
Factors that may be considered a change in circumstances, indicating that the carrying value of the goodwill or amortizable intangible assets may not be recoverable, include a decline in Popular’s stock price related to a deterioration in global or local economic conditions, declines in our market capitalization, reduced future earnings estimates, and interest rate changes.
We are dependent on Evertec for the provision of essential services to our business, including certain of our core financial transaction processing and information technology and security services. As a result, we are particularly exposed to the operational risks of Evertec, including those related to its security architecture and potential breakdowns or failures of Evertec’s systems or internal controls environment.
We are dependent on Evertec for the provision of essential services to our business, including certain of BPPR’s core financial transaction processing and information technology and security services. As a result, we are particularly exposed to the operational risks of Evertec, including those related to its security architecture and potential breakdowns or failures of Evertec’s systems or internal controls environment.
Furthermore, failure to realize the expected revenue increases, cost savings, increases in geographic or product 35 presence, or other projected benefits from an acquisition could have a material adverse effect on our business, financial condition and results of operations. Similarly, acquiring loan portfolios involves various risks.
Furthermore, failure to realize the expected revenue increases, cost savings, increases in geographic or product presence, or other projected benefits from an acquisition could have a material adverse effect on our business, financial condition and results of operations. Similarly, acquiring loan portfolios involves various risks.
Any problems caused by these vendors, including those resulting from disruptions in the services provided, vulnerabilities in or breaches of the vendor’s systems or environments, failure of the vendor to handle current or higher volumes, failure of the vendor to provide services for any reason or poor performance of services, failure of the vendor to notify us of a reportable event in a timely manner, our vendors’ misuse of artificial intelligence and other automatic decision making technologies, could adversely affect our ability to deliver products and services to our customers and otherwise conduct our business, disrupt our operations, result in potential liability to clients and customers, result in the imposition of fines, penalties or judgments by our regulators, lead to exposure of our information or that of our customers or harm to our reputation, any of which could materially and adversely affect us.
Any problems caused by these vendors, including those resulting from disruptions in the services provided, vulnerabilities in or breaches of the vendor’s systems or environments, failure of the vendor to handle current or higher volumes, failure of the vendor to provide services for any reason or poor performance of services, failure of the vendor to notify us of a reportable event in a timely manner, or our vendors’ misuse of artificial intelligence and other automatic decision making technologies, could adversely affect our ability to deliver products and services to our customers and otherwise conduct our business, disrupt our operations, result in potential liability to customers and counterparties, result in the imposition of fines, penalties or judgments by our regulators, lead to exposure of our information or that of our customers or harm to our reputation, any of which could materially and adversely affect us.
Therefore, the outcome of any investigative or enforcement action, which may take years and be material to Popular, may be difficult to predict or estimate. Complying with economic and trade sanctions programs and anti-money laundering laws and regulations can increase our operational and compliance costs and risks.
Therefore, the outcome of any investigative or enforcement action, which may take years and be material to Popular, may be difficult to predict or estimate. Complying with economic and trade sanctions programs and anti-money laundering laws and regulations can increase our operational and compliance costs.
There can be no assurances that any failure to comply with U.S. sanctions and embargoes, or with anti-money laundering laws and regulations, will not result in material fines, sanctions or other penalties being imposed on us.
There can be no assurances that any failure to comply with U.S. 32 sanctions and embargoes, or with anti-money laundering laws and regulations, will not result in material fines, sanctions or other penalties being imposed on us.
For example, we use estimates and assumptions to determine our allowance for credit losses, our liability for contingent litigation losses, and the fair value of certain of our assets and liabilities, such as debt securities, loans held for sale, MSRs, intangible assets and deferred tax assets.
For example, we use estimates and assumptions to determine our allowance for credit losses, our liability for contingent litigation losses, and the fair value of certain 37 of our assets and liabilities, such as debt securities, loans held for sale, MSRs, intangible assets and deferred tax assets.
If deposits decrease, we may need to rely on more expensive sources of funding, which would negatively impact our interest rate margin and net interest income. In addition, a reduction in our deposits would decrease our earning assets, which would also negatively affect our net interest income.
If deposits decrease, we may need to rely on 26 more expensive sources of funding, which would negatively impact our interest rate margin and net interest income. In addition, a reduction in our deposits would decrease our earning assets, which would also negatively affect our net interest income.
The ability of our hardware and software providers to deliver patches and updates to mitigate vulnerabilities in a timely manner can introduce additional risks, particularly when a vulnerability is being actively exploited by threat actors.
The ability of our hardware and software providers to deliver patches and updates to mitigate vulnerabilities in a timely manner can introduce additional risks, particularly when a vulnerability is being actively exploited by threat 28 actors.
Our ability to compete effectively will depend in part on our ability to react quickly to meet new industry standards and use new technology, such as artificial 36 intelligence, to satisfy customer demands, as well as to create additional efficiencies in our operations.
Our ability to compete effectively will depend in part on our ability to react quickly to meet new industry standards and use new technology, such as artificial intelligence, to satisfy customer demands, as well as to create additional efficiencies in our operations.
Treasury securities with a fair value of approximately $6.5 billion (par value of $7.4 billion), and with accumulated unrealized losses of $873 million, from our available-for-sale portfolio to our held-to-maturity portfolio.
Treasury securities with a fair value of $6.5 billion (par value of $7.4 billion), and with accumulated unrealized losses of $873 million, from our available-for-sale portfolio to our held-to-maturity portfolio.
Any such impact could, in turn, reduce Popular’s revenues, place us in a competitive disadvantage and significantly affect our business, financial condition, liquidity, results of operations or capital position.
Any such impact could, in turn, reduce Popular’s revenues, place us at a competitive disadvantage and significantly affect our business, financial condition, liquidity, results of operations or capital position.
The effects of these changes may be amplified if we are unable to effectively manage the sensitivity of our assets and liabilities to market interest rate changes. The rapid rise in interest rates in 2022 resulted in approximately $2.5 billion in unrealized mark-to-market losses on 25 available-for-sale securities held in our investment securities portfolio. In October 2022, we transferred U.S.
The effects of these changes may be amplified if we are unable to effectively manage the sensitivity of our assets and liabilities to market interest rate changes. The rapid rise in interest rates in 2022 resulted in $2.5 billion in unrealized mark-to-market losses on available-for-sale securities held in our investment securities portfolio. In October 2022, we transferred U.S.
Our customer-facing platforms are also routinely attacked by threat actors aiming to gain unauthorized access to our clients’ accounts. Although we have implemented defensive measures designed to protect against such attacks, there is no assurance that these defensive measures will keep pace with threats that are continuous and growing in severity.
Our customer-facing platforms are also routinely targeted by threat actors aiming to gain unauthorized access to our clients’ accounts. Although we have implemented defensive measures designed to protect against such attacks, there is no assurance that these defensive measures will keep pace with threats that are continuous and growing in severity.
Substantial legal liability or significant regulatory action against us could have material adverse financial effects or cause significant reputational harm to us or other adverse consequences, which in turn could seriously harm our business prospects. For further information relating to our legal risk, see Note 24 - “Commitments & Contingencies”, to the Consolidated Financial Statements in this Form 10-K.
Substantial legal liability or significant regulatory action against us could have material adverse financial effects or cause significant reputational harm to us or other adverse consequences, which in turn could seriously harm our business prospects. For further information relating to our legal risk, see Note 23 - “Commitments & Contingencies”, to the Consolidated Financial Statements in this Form 10-K.
While we have over time narrowed the scope of services which we are dependent on Evertec to obtain, in exchange for releases from exclusivity restrictions that limited our ability to engage other third-party providers of financial technology services, we agreed to extensions of certain existing commercial agreements with Evertec and, as a result, have prolonged the duration of our exposure to the risks presented by Evertec’s technological capabilities and its failures to enhance its products and services and otherwise meet evolving demands.
While we have over time narrowed the scope of services which we are dependent on Evertec to obtain, in exchange for obtaining releases in 2022 from exclusivity restrictions that limited our ability to engage other third-party providers of financial technology services, we agreed to extensions of certain existing commercial agreements with Evertec and, as a result, have prolonged the 36 duration of our exposure to the risks presented by Evertec’s technological capabilities and its failures to enhance its products and services and otherwise meet evolving demands.
During 2023, personal information of Popular customers’ data was compromised in a data breach incident that impacted MOVEit, the third-party file transfer platform used by one of our service providers. In both instances, Popular notified, as required or otherwise deemed appropriate, customers identified as affected by the incident.
During 2023, personal information of Popular customers’ data was compromised in a data breach incident that impacted MOVEit, the third-party file transfer platform used by one of our service providers. Popular notified, as required or otherwise deemed appropriate, customers identified as affected by the incident.
Upon the transition of all or a portion of existing services provided by Evertec to new financial services technology providers, either (i) at the end of the term of the Second Amended and Restated Master Services Agreement (the “MSA”) and related agreements or (ii) earlier upon the termination of any service for convenience under the MSA, these transition risks could result in an adverse effect on our business, financial condition and results of operations.
As we transition all or a portion of the existing services provided by Evertec to new financial services technology providers, either (i) at the end of the term of the Second Amended and Restated Master Services Agreement (the “MSA”) and related agreements or (ii) earlier upon the termination of any service for convenience 29 under the MSA, these transition risks could result in an adverse effect on our business, financial condition and results of operations.
The risk of a security breach due to a cyber-attack is expected to increase as we continue to expand our mobile banking and other internet-based product offerings, the use of the cloud for system development and hosting and internal use of internet-based products and applications.
The risk of a security breach due to a cyber-attack is expected to increase as we continue to expand our digital capabilities, mobile banking and other internet-based product offerings, the use of the cloud for system development and hosting and internal use of internet-based products and applications.
We are from time to time subject to information requests, investigations and other regulatory enforcement proceedings from departments and agencies of the U.S. and Puerto Rico governments, including those that investigate compliance with U.S. sanctions and consumer protection laws and regulations, which may expose us to significant penalties and collateral consequences, and could result in higher compliance costs or restrictions on our operations.
We are from time to time subject to information requests, investigations and other regulatory enforcement proceedings from departments and agencies of the U.S., Puerto Rico, New York and other state governments, including those that investigate compliance with U.S. sanctions and consumer protection laws and regulations, which may expose us to significant penalties and collateral consequences, and could result in higher compliance costs or restrictions on our operations.
Difficulties associated with potential acquisitions that may result from these factors could have a material adverse effect on our business, financial condition and results of operations. We have embarked on a broad-based multi-year, technological and business process transformation.
Difficulties associated with potential acquisitions that may result from these factors could have a material adverse effect on our business, financial condition and results of operations. We continue our broad-based multi-year, technological and business process transformation.
As of December 31, 2024, we had $13 billion of total deposits (other than collateralized public funds, which represent public deposit balances from governmental entities in the U.S. and its territories, including Puerto Rico and the United States Virgin Islands, that are collateralized based on such jurisdictions’ applicable collateral requirements) in excess of the FDIC-insured limit.
As of December 31, 2025, we had $14 billion of total deposits (other than collateralized public funds, which represent public deposit balances from governmental entities in the U.S. and its territories, including Puerto Rico and the United States Virgin Islands, that are collateralized based on such jurisdictions’ applicable collateral requirements) in excess of the FDIC-insured limit.
As of December 31, 2024, we had $13 billion of total deposits (other than collateralized public funds, which represent public deposit balances from governmental entities in the U.S. and its territories, including Puerto Rico and the United States Virgin Islands, that are collateralized based on such jurisdictions’ applicable collateral requirements) in excess of the FDIC-insured limit.
As of December 31, 2025, we had $14 billion of total deposits (other than collateralized public funds, which represent public deposit balances from governmental entities in the U.S. and its territories, including Puerto Rico and the United States Virgin Islands, that are collateralized based on such jurisdictions’ applicable collateral requirements) in excess of the FDIC-insured limit.
In practice, in order to switch to a new provider for a particular service, we will have to commence procuring and working on a transition process for such service significantly in advance of its termination and, in any case, much earlier than the automatic renewal notice date or the expiration date of the MSA, and such process may extend beyond the current term of the MSA.
In practice, in order to switch to a new provider for a particular service, we will have to commence procuring and working on a transition process for such service significantly in advance of its termination and, in any case, much earlier than the expiration date of the MSA, and such process may extend beyond the current term of the MSA.
We may also be exposed to heightened business risks in connection with our dependency on Evertec with respect to BPPR’s merchant acquiring business, which exclusivity was extended until 2035, and with respect to the ATH Network, which commitment BPPR extended until 2030, in light of the pace of technology changes and competition in the payments industry.
We may also be exposed to heightened business risks in connection with our dependency on Evertec with respect to BPPR’s merchant acquiring business, which exclusivity runs until 2035, and with respect to the ATH Network, which commitment runs until 2030, in light of the pace of technology changes and competition in the payments industry.
A significant portion of our business is concentrated in Puerto Rico, which accounted for approximately 77% of our assets and 80% of our deposits as of December 31, 2024 and 79% of our revenues for the year ended December 31, 2024.
A significant portion of our business is concentrated in Puerto Rico, which accounted for 77% of our assets and 79% of our deposits as of December 31, 2025 and 80% of our revenues for the year ended December 31, 2025.
Upon failure to maintain the required credit ratings, the third parties could have the right to require us to engage a substitute fund custodian and increase collateral levels securing recourse obligations. Collateral pledged by us to secure recourse obligations approximated $23.9 million on December 31, 2024.
Upon failure to maintain the required credit ratings, the third parties could have the right to require us to engage a substitute fund custodian and increase collateral levels securing recourse obligations. Collateral pledged by us to secure recourse obligations approximated $23.8 million on December 31, 2025.
While the size of our unrealized mark-to-market losses on available-for- sale securities had been reduced to $1.3 billion as of December 31, 2024, if interest rates were to again rise rapidly or for a prolonged period, we may accumulate significant additional mark-to-market losses on investment securities in our available-for-sale portfolio, which may adversely affect our tangible capital and impact our ability to return capital to our stockholders.
While the size of our unrealized mark-to-market losses on available-for-sale securities had been reduced to $0.9 billion as of December 31, 2025, if interest rates were to again rise rapidly or for a prolonged period, we may accumulate significant additional mark-to-market losses on investment securities in our available-for-sale portfolio, which may adversely affect our tangible capital and impact our ability to return capital to our stockholders.
Additionally, the new federal administration is pursuing a regulatory agenda significantly different from that of the previous administration, including the possible reversal of rules promulgated under the past administration and shifts in rulemaking, supervision, examination and enforcement priorities. The implementation of that agenda is happening rapidly and is constantly evolving.
Additionally, the current federal administration is pursuing a policy and regulatory agenda significantly different from that of the previous administration, including the reversal of rules promulgated under the past administration and shifts in rulemaking, supervision, examination and enforcement priorities. The implementation of that agenda is happening rapidly and is constantly evolving.
For example, certain customers have been affected by brute force attacks on one of our platforms, which resulted in certain of our customers log- in credentials and information being exposed and accounts being taken over, resulting in fraudulent transfers or withdrawals. Popular customers have also been impacted by card skimming events in our ATM terminals.
For example, in 2022, certain customers were affected by brute force attacks on one of our platforms, which resulted in certain of our customers log- in credentials and information being exposed, resulting in fraudulent transfers or withdrawals. Popular customers have also been impacted by card skimming events in our ATM terminals.
We from time-to-time self-report compliance matters to, or receive requests for information from, departments and agencies of the U.S. and Puerto Rico governments, including with respect to compliance with consumer protection laws and regulations.
We from time-to-time self-report compliance matters to, or receive requests for information from, departments and agencies of the U.S., Puerto Rico, New York and other state governments, including with respect to compliance with consumer protection laws and regulations.
Because of our contractual relationship with Evertec, and because Popular is the sole customer of certain of Evertec’s services and products, we have in the past borne the full cost of such developments and modifications and may be required to do so in the future, subject to the terms of the MSA.
Because of our contractual relationship with Evertec, and because Popular is the sole customer of certain of Evertec’s services and products, including core bank processing of BPPR, we have in the past borne the full cost of such developments and modifications and may be required to do so in the future, subject to the terms of the MSA.
As of December 31, 2024, approximately 55% of our loan portfolio consisted of loans secured by real estate collateral (comprised of 29% in commercial loans, 22% in residential mortgage loans and 3% in construction loans). The value of the collateral securing such loans is dependent upon economic conditions in the area in which the collateral is located.
As of December 31, 2025, 55% of our loan portfolio consisted of loans secured by real estate collateral (comprised of 29% in commercial loans, 22% in residential mortgage loans and 4% in construction loans). The value of the collateral securing such loans is dependent upon economic conditions in the area in which the collateral is located.
More recently, Puerto Rico has received significant federal stimulus, disaster relief and reconstruction funding, which has served as a major driver of economic activity. Reductions in federal funding for Puerto Rico or delays in disbursements could significantly impact Puerto Rico’s economy and hinder reconstruction efforts, including the restoration and improvement of critical infrastructure.
More recently, Puerto Rico has received significant federal stimulus, disaster relief and reconstruction funding, which has served as a major driver of economic activity. Reductions in federal funding to programs that have benefited the Puerto Rico economy or delays in disbursements could significantly impact Puerto Rico’s economy and hinder reconstruction efforts, including the restoration and improvement of critical infrastructure.
We have a significant amount of deposits from the Puerto Rico government, its instrumentalities and municipalities ($19.5 billion, or approximately 30% of our total deposits, as of December 31, 2024), and the amount of these deposits may fluctuate depending on the financial condition and liquidity of these entities, as well as on our ability to maintain these customer relationships.
We have a significant amount of deposits from the Puerto Rico government, its instrumentalities and municipalities ($19.4 billion, or 29% of our total deposits, as of December 31, 2025), and the amount of these deposits may fluctuate depending on the financial condition and liquidity of these entities, as well as on our ability to maintain these customer relationships.
Switching from one vendor of core bank processing and related technology and security services to one or more new vendors is a complex process that carries business and financial risks. The implementation cycle for such a transition can be lengthy and require significant financial and management resources from us.
Switching from one vendor of core financial transaction processing and related technology and security services to one or more new vendors is a complex process that carries business and financial risks. The implementation cycle for such a transition would be lengthy and require significant financial and management resources from BPPR and Popular.
If Popular’s operational systems, or those of external parties on which Popular’s businesses depend, are unable to meet the requirements of our businesses and operations or bank regulatory standards, or if they fail, have other significant shortcomings or are impacted by cyber-attacks, Popular could be materially and adversely affected.
If Popular’s operational systems, or those of external parties on which Popular’s businesses depend, are unable to meet the requirements of our businesses and operations or the standards of our regulators or other applicable data protection and privacy laws, or if they fail, have other significant shortcomings or are impacted by cyber-attacks, Popular could be materially and adversely affected.
Both BPPR and PB have secured borrowing facilities with the FHLBNY and could borrow up to $3.2 billion and $1.5 billion respectively as of December 31, 2024, of which $0.1 billion and $0.4 billion respectively were used. Losing access to the FHLBNY borrowing facilities could adversely impact liquidity at the banking subsidiaries.
Both BPPR and PB have secured borrowing facilities with the FHLBNY and could borrow up to $3.3 billion and $1.5 billion respectively as of December 31, 2025, of which $42.7 million and $0.8 billion respectively were used. Losing access to the FHLBNY borrowing facilities could adversely impact liquidity at the banking subsidiaries.
To compete effectively, we need to constantly enhance and modify our products and services and introduce new products and services to attract and retain clients or to match products and services offered by our competitors, including technology companies and other nonbank firms that are engaged in providing similar products and services.
To compete effectively, we need to constantly enhance and modify our products and services and introduce new products and services to attract and retain clients or to match products and services offered by our competitors, including technology companies and other nonbank firms that are engaged in providing similar products and services, some of which are or may be provided by Evertec itself.
While we maintain insurance against natural disasters and other unforeseen events, including coverage for business interruption, the insurance may not be sufficient to cover all of the damage from any such event, and there is no insurance against the disruption that a catastrophic event could produce to the markets that we serve and the potential negative impact to economic activity. 29 Climate change could have a material adverse impact on our business operations and that of our clients and customers.
While we maintain insurance against natural disasters and other unforeseen events, including coverage for business interruption, the insurance may not be sufficient to cover all of the damage from any such event, and there is no insurance against the disruption that a catastrophic event could produce to the markets that we serve and the potential negative impact to economic activity.
Such a transition can also increase costs (including 30 conversion costs) and expose us and our clients to business disruption, as well as operational and cybersecurity risks.
Such a transition can also increase costs (including conversion costs), impede or disrupt business or technological initiatives, and expose us and our clients to business disruption, as well as operational and cybersecurity risks.
To the extent that these disruptions persist over time and/or recur, this could negatively impact our competitive position, require additional expenditures, and/or harm our relationships with our customers and thus may materially adversely affect our business, financial condition, results of operations, or cause reputational harm. We face significant and increasing competition in the rapidly evolving financial services industry.
To the extent that these disruptions persist over time and/or recur, this could negatively impact our competitive position, require additional expenditures, 35 and/or harm our relationships with our customers and thus may materially adversely affect our business, financial condition, results of operations, or cause reputational harm.
The failure to achieve the goals of the transformation project, the inability to maintain expenses related to our transformation program within current estimates or delays in executing our plans may materially and adversely affect our business, competitive position, financial condition, results of operations, or cause reputational harm. The Corporation has embarked on a broad-based multi-year, technological and business process transformation.
The failure to achieve the goals of the transformation project, the inability to maintain expenses related to our transformation program within current estimates or delays in executing our plans may materially and adversely affect our business, competitive position, financial condition, results of operations, or cause reputational harm.
The potential impact of any such changes cannot be predicted at this time.
The potential impact of any such changes cannot be predicted.
Third parties provide key components of our business operations, such as data processing, information security, recording and monitoring transactions, online banking interfaces and services, Internet connections and network access. The most important of these third-party service providers for us is Evertec.
Third parties provide key components of our business operations, such as data processing, information security, recording and monitoring transactions, online banking interfaces and services, Internet connections and network access. The most important of these third-party service providers for us is Evertec due in large part to its role as a service provider to BPPR, our principal banking subsidiary.
For more information on the credit quality of our construction, commercial and mortgage portfolio, see the Credit Risk section of the MD&A included in this Form 10-K.
For more information on the credit quality of our construction, commercial and mortgage portfolio, see the Credit Risk section of the MD&A included in this Form 10-K. Defective and repurchased loans may harm our business and financial condition.
Cyber-security risks have also been recently exacerbated by the discovery of zero-day vulnerabilities in widely distributed third party software, which have in the past affected and in the future could affect Popular’s or any of its service provider’s systems, as further detailed below.
As a result, we have notified, and conducted additional remediation for, customers identified as affected by these incidents. Cyber-security risks have also been exacerbated by the discovery of zero-day vulnerabilities in widely distributed third party software, which have in the past affected and in the future could affect Popular’s or any of its service provider’s systems, as further detailed below.
Defective and repurchased loans may harm our business and financial condition. 26 In connection with the sale and securitization of mortgage loans, we are required to make a variety of customary representations and warranties regarding Popular and the loans being sold or securitized.
In connection with the sale and securitization of mortgage loans, we are required to make a variety of customary representations and warranties regarding Popular and the loans being sold or securitized.
As of December 31, 2024, we had approximately $803 million, $926 million and $143 million, respectively, of goodwill, net deferred tax assets and amortizable intangible assets, including capitalized software costs, recorded on our balance sheet.
As of December 31, 2025, we had $790 million, $814 million and $188 million, respectively, of goodwill, net deferred tax assets and amortizable intangible assets, including capitalized software costs, recorded on our balance sheet.
Increased competition could create pressure to lower prices, fees, commissions or credit standards on our products and services, which could adversely affect our financial condition and results of operations. Increased competition could also create pressure to raise interest rates on deposits or increase deposit attrition, which could negatively impact our business, financial condition, liquidity results of operations or capital position.
Increased competition could also create pressure to raise interest rates on deposits or increase deposit attrition, which could negatively impact our business, financial condition, liquidity results of operations or capital position.
We are subject to extensive and evolving regulation under U.S. federal, state and Puerto Rico laws that govern almost all aspects of our operations and limit the businesses in which we may be engaged, including regulation, supervision and examination by federal, state and foreign banking authorities.
LEGAL AND REGULATORY RISKS Our businesses are highly regulated, and the laws and regulations that apply to us have a significant impact on our business and operations. 30 We are subject to extensive and evolving regulation under U.S. federal, state and Puerto Rico laws that govern almost all aspects of our operations and limit the businesses in which we may be engaged, including regulation, supervision and examination by federal, state and foreign banking authorities.
The increased use of remote access and third-party video conferencing solutions to enable work-from-home arrangements for employees and facilitate the use of digital channels by our customers, has also increased our exposure to cyber- attacks, including through the use of deep fakes and brand impersonation.
The increased use of remote access and third-party video conferencing solutions to enable work-from-home arrangements for employees has also increased our exposure to cyber-attacks, including through the use of deep fakes and brand impersonation. We expect the rise and use of artificial intelligence to exacerbate this risk.
An impact on the tangible capital levels of our operating subsidiaries, could also limit the amount of capital we may upstream to the holding company. Tangible capital levels have in the past been, and may in the future be, adversely affected by the impact of rapidly rising interest rates on investment securities in our available-for-sale portfolio.
Tangible capital levels have in the past been, and may in the future be, adversely affected by the impact of rapidly rising interest rates on investment securities in our available-for-sale portfolio.
As our competitors have raised the interest rates they pay on deposits, our funding costs have increased, as we have had to increase the rates we pay to our depositors to avoid losing deposits and to procure new ones. Rising interest rates have also led customers to move their funds to alternative investments that pay higher interest rates.
As our competitors have raised the interest rates they pay on deposits, our funding costs have increased, as we have had to increase the rates we pay to our depositors to avoid losing deposits and to procure new ones.
Substantially all the deposits of BPPR and PB are subject to insurance up to applicable limits by the FDIC’s deposit insurance fund (“DIF”) and, as a result, BPPR and PB are subject to FDIC deposit insurance assessments.
Increases in FDIC insurance premiums may have a material adverse effect on our earnings. Substantially all the deposits of BPPR and PB are subject to insurance up to applicable limits by the FDIC’s deposit insurance fund (“DIF”) and, as a result, BPPR and PB are subject to FDIC deposit insurance assessments.
We may not succeed in executing the transformation program, may fail to properly estimate costs of the same, or may experience delays in executing our plans, which may in turn cause the Corporation to incur costs exceeding our current estimates or disrupt our operations, including our technological services to our customers, or fall short of our projected earnings or expense reduction targets driven by these efforts.
Such failures or delays may in turn cause the Corporation to incur costs exceeding our current estimates or disrupt our operations, including our technological services to our customers, or fall short of our projected earnings or expense reduction targets driven by these efforts.
We have in the past suspended dividend payments on our common stock and preferred stock during times of economic uncertainty, and there can be no assurance that we will be able to continue to declare dividends to our stockholders in any future periods.
We have in the past suspended dividend payments on our common stock and preferred stock during times of economic uncertainty, and there can be no assurance that we will be able to continue to declare dividends to our stockholders in any future periods. 34 An impact on the tangible capital levels of our operating subsidiaries, could also limit the amount of capital we may upstream to the holding company.
Evertec’s failure to sufficiently invest in and upscale its technology and services infrastructure to meet the rapidly changing technology demands of our industry may result in us being unable to meet customer expectations and attract or retain customers. Furthermore, Evertec’s strategy and investments may also be refocused away from Popular towards other strategic initiatives.
Evertec’s failure to sufficiently invest in and upscale its technology and services infrastructure to meet the rapidly changing technology demands of our industry may result in our being unable to meet customer expectations and attract or retain customers.
Incidents of this nature and investigations or examinations by governmental authorities have resulted in the past, and may in the future result, in judgments, settlements, fines, enforcement actions, penalties or other sanctions adverse to the Corporation, which could materially and adversely affect the Corporation’s business, financial condition, results of operations or capital position or cause serious reputational harm.
BPPR has also self-identified and reported to applicable regulators compliance matters related to U.S. sanctions, as well as mortgage, credit reporting and other consumer lending practices. 31 Incidents of this nature and investigations or examinations by governmental authorities have resulted in the past, and may in the future result, in judgments, settlements, fines, enforcement actions, penalties or other sanctions adverse to the Corporation, which could materially and adversely affect the Corporation’s business, financial condition, results of operations or capital position or cause serious reputational harm.
If we, and our subsidiaries, affiliates or third-party service providers, are found to have failed to comply with applicable economic and trade sanctions programs and anti-money laundering laws and regulations, we could be exposed to fines, sanctions and penalties, and other regulatory actions, as well as governmental investigations. 32 As a federally regulated financial institution, we must comply with regulations and economic and trade sanctions and embargo programs administered by the Office of Foreign Assets Control (“OFAC”) of the U.S.
If we, and our subsidiaries, affiliates or third-party service providers, are found to have failed to comply with applicable economic and trade sanctions programs and anti-money laundering laws and regulations, we could be exposed to fines, sanctions and penalties, and other regulatory actions, as well as governmental investigations.
Our business and the activities and operations of our clients and customers may be disrupted by global climate change.
Climate change could have a material adverse impact on our business operations and that of our clients and customers. Our business and the activities and operations of our clients and customers may be disrupted by global climate change.
If the mix of our deposits shifts towards a higher proportion of higher-cost deposits for any reason, our funding costs would increase and our net interest income would be expected to decrease.
If the mix of our deposits shifts towards a higher proportion of higher-cost deposits for any reason, our funding costs would increase and our net interest income would be expected to decrease. OPERATIONAL RISKS We and our third-party providers have been, and expect in the future to continue to be, subject to cyber-attacks.
At December 31, 2024, our exposure to the Puerto Rico government consisted of $336 million in direct lending exposure to Puerto Rico municipalities and $220 million in loans insured or securities issued by Puerto Rico governmental entities but for which the principal source of repayment is non-governmental. and indirect lending exposure to the Puerto Rico government in the form of loans to private borrowers who are service providers, lessors, suppliers or have other relationships with the Puerto Rico government.
At December 31, 2025, our exposure to the Puerto Rico government consisted of $391 million in direct lending exposure to Puerto Rico municipalities and $209 million in loans insured or securities issued by Puerto Rico governmental entities but for which the principal source of repayment is non-governmental.
Furthermore, during 2024, threat actors exploited a zero-day vulnerability in the Fortinet enterprise management server software used by Evertec, which migrated to one of Popular's domain controllers due to a shared network environment. While Evertec determined that no BPPR customer information was exfiltrated as a result of this incident, the event underscores the risks inherent in Popular’s dependency on Evertec.
Furthermore, during 2024, threat actors exploited a zero-day vulnerability in the Fortinet enterprise management server software used by Evertec, which migrated to one of Popular's domain controllers due to a shared network environment.
In particular, we could be adversely impacted by changes in laws and regulations, or changes in the application, interpretation or enforcement of laws and regulations, that proscribe or institute more stringent restrictions on certain financial services activities, impose monetary fines or other penalties on institutions that fail to comply with applicable laws and regulations, or impose new requirements relating to the impact of business activities on ESG concerns, the management of risks associated with those concerns and the extent to which ESG-related objectives are taken into account in financing and other business activities and decision-making, such as the offering of products intended to achieve ESG-related objectives.
In particular, we could be adversely impacted by changes in laws and regulations, or changes in the application, interpretation or enforcement of laws and regulations, that proscribe or institute more stringent restrictions on certain financial services activities, impose monetary fines or other penalties on institutions that fail to comply with applicable laws and regulations, or impose new requirements.
Additional risks and uncertainties not currently known by us or that we currently deem to be immaterial, or that are generally applicable to all financial institutions, may also materially adversely affect our business, financial condition, liquidity, results of operations or capital position. 24 ECONOMIC AND MARKET RISKS Weakness in the economy, particularly in Puerto Rico, where a significant portion of our business is concentrated, has adversely impacted us in the past and may adversely impact us in the future.
The risks described in this report are not the only risks we face. Additional risks and uncertainties not currently known by us or that we currently deem to be immaterial, or that are generally applicable to all financial institutions, may also materially adversely affect our business, financial condition, liquidity, results of operations or capital position.
Cyber-attacks could also cause interruptions in our operations and result in the incurrence of significant costs, including those related to forensic analysis and legal counsel. We also rely on third parties for the performance of a significant portion of our information technology functions and the provision of information security, technology and business process services.
We also rely on third parties for the performance of a significant portion of our information technology functions and the provision of information security, technology and business process services.
See “Our businesses are highly regulated, and the laws and regulations that apply to us have a significant impact on our business and operations” in the Legal and Regulatory Risks section of Item 1A in this Form 10-K. 33 Increases in FDIC insurance premiums may have a material adverse effect on our earnings.
The failure of any depository institution subsidiary of a financial holding company to maintain well-capitalized or well-managed status could have similar consequences. See “Our businesses are highly regulated, and the laws and regulations that apply to us have a significant impact on our business and operations” in the Legal and Regulatory Risks section of Item 1A in this Form 10-K.
OPERATIONAL RISKS We and our third-party providers have been, and expect in the future to continue to be, subject to cyber-attacks, which could cause substantial harm and have an adverse effect on our business and results of operations.
Future cyber-attacks could cause substantial harm and have an adverse effect on our business and results of operations.
Computer intrusion attempts, either direct or through social engineering (pretext calls), supply chain compromise, email, text or voice messages, including using brand impersonation (regularly referred to as phishing, vishing, smishing and quishing), have resulted in and may continue to result in the compromise of sensitive customer data, such as account numbers, credit cards and social security numbers, and could present significant reputational, legal and regulatory costs to Popular if successful.
These types of cyber-attacks have in the past resulted and may continue to result in the compromise of sensitive customer data, such as account numbers, credit cards and social security numbers, and could present significant reputational, legal and regulatory costs to Popular if successful.
Moreover, new regulations may require us to disclose information about a cybersecurity event before it has been resolved or fully investigated. Furthermore, it may not be clear how best to contain and remediate the potential harm caused by the cyber-attack, and certain errors or actions could be repeated or compounded before they are discovered and remediated.
Furthermore, it may not be clear how best to contain and remediate the potential harm caused by the cyber-attack, and certain errors or actions could be repeated or compounded before they are discovered and remediated. Cyber-attacks could also cause interruptions in our operations and result in the incurrence of significant costs, including those related to forensic analysis and legal counsel.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeUnder the heading “We and our third-party providers have been, and expect in the future to continue to be, subject to cyber-attacks, which could cause substantial harm and have an adverse effect on our business and results of operations.” and “We rely on other companies to provide key components of our business infrastructure, including certain of our core financial transaction processing and information technology and security services, which exposes us to a number of operational risks that could have a material adverse effect on us.”, included as part of our risk factor disclosures in Item 1A in this Form 10-K, which disclosures are incorporated by reference herein, we describe whether and how risks from identified cybersecurity threats, including as a result of any previous cybersecurity incidents, could have materially affected or are reasonably likely to materially affect us, including our business strategy, results of operations, or financial condition.
Biggest changeFuture cyber- attacks could cause substantial harm and have an adverse effect on our business and results of operations.” and “We rely on other companies to provide key components of our business infrastructure, including certain of our core financial transaction processing and information technology and security services, which exposes us to a number of operational risks that could have a material adverse effect on us.”, included as part of our risk factor disclosures in Item 1A in this Form 10-K, which disclosures are incorporated by reference herein.
The Corporation also undertakes the below listed additional activities in its effort to maintain regulatory compliance, identify, assess and manage its material risks from cybersecurity threats, and to protect against, detect and respond to cybersecurity incidents: 39 ● Conduct tabletop exercises that simulate cybersecurity incidents to raise awareness and enhance Popular’s responsive measures; ● Assess how business and corporate strategies, new products, technology deployments, external events and the evolution of threats impact the Corporation’s information security controls in order to determine if they require any additional resources, technology or processes; ● Discuss cybersecurity risks with law enforcement, peer groups, industry forums and trade associations; ● Provide training to all Popular employees upon hiring and annually thereafter on cybersecurity and customer data handling and use requirements; ● Offer training and awareness campaigns to customers and employees based on their role; ● Conduct phishing simulations for employees, with escalation protocols for employees that fail such tests to enhance awareness and responsiveness to such possible threats; ● Offer learning and development opportunities to employees who handle and manage cybersecurity matters; ● Carry cyber insurance to provide protection against potential losses arising from cybersecurity incidents; and ● Monitor emerging legal and regulatory requirements and implement changes to our processes, policies and statements, as necessary.
The Corporation also undertakes the below listed additional activities in its effort to maintain regulatory compliance, identify, assess and manage its material risks from cybersecurity threats, and to protect against, detect and respond to cybersecurity incidents: ● Conduct tabletop exercises that simulate cybersecurity incidents to raise awareness and enhance Popular’s responsive measures; ● Assess how business and corporate strategies, new products, technology deployments, external events and the evolution of threats impact the Corporation’s information security controls in order to determine if they require any additional resources, technology or processes; ● Discuss cybersecurity risks with law enforcement, peer groups, industry forums and trade associations; 39 ● Provide training to all Popular employees upon hiring and annually thereafter on cybersecurity and customer data handling and use requirements; ● Offer training and awareness campaigns to customers and employees based on their role; ● Conduct phishing simulations for employees, with escalation protocols for employees that fail such tests to enhance awareness and responsiveness to such possible threats; ● Offer learning and development opportunities to employees who handle and manage cybersecurity matters; ● Carry cyber insurance to provide protection against potential losses arising from cybersecurity incidents; and ● Monitor emerging legal and regulatory requirements and implement changes to our processes, policies and statements, as necessary.
She is a Certified Public Accountant that also holds a Juris Doctor degree and FINRA administered Series 7 and Series 27 certifications. She holds the title of Executive Vice President and Chief Security Officer and has been in her role since 2018.
She is a Certified Public Accountant and also holds a Juris Doctor degree and FINRA administered Series 7 and Series 27 certifications. She holds the title of Executive Vice President and Chief Security Officer and has been in her role since 2018.
The Board in turn also receives briefings on cybersecurity matters and risks, including an annual presentation from the Chief Security Officer and the CISO on the Information Security Program.
The Board in turn also receives briefings on cybersecurity matters and risks, including an annual presentation from the Chief 38 Security Officer and the CISO on the Information Security Program.
The CRI Profile was produced through public-private collaboration and is a list of assessment questions curated based on the intersection of global regulations and cyber standards, such as the International Standards Organization (ISO) and the NIST. The CSD also manages the Incident Response Program (“IRP”) of the Corporation and is in charge of overseeing, assessing and managing cyber incidents.
The CRI Profile was produced through public-private collaboration and is a list of assessment questions curated based on the intersection of global regulations and cyber standards, such as the International Standards Organization (ISO) and the NIST. The CISP also manages the Incident Response Program (“IRP”) of the Corporation and is in charge of overseeing, assessing and managing cyber incidents.
Popular monitors various vectors of threats and utilizes open-source intelligence forums and communities such as the Financial Services Information Sharing and Analysis Center and the Cybersecurity and Infrastructure Security Agency, among others, to receive threat intelligence feeds which are reviewed by the CSD.
Popular monitors various vectors of threats and utilizes open-source intelligence forums and communities such as the Financial Services Information Sharing and Analysis Center and the Cybersecurity and Infrastructure Security Agency, among others, to receive threat intelligence feeds which are reviewed by the CISP.
The Board has also established a Board-level Risk Management Committee (“RMC”), which is responsible for the oversight of the 38 Corporation’s overall risk framework, and assists the Board in the monitoring, review and approval of the policies that measure, limit and manage the Corporation’s risks, including cybersecurity risk.
The Board has established a Board-level Risk Management Committee (“RMC”), which is responsible for the oversight of the Corporation’s overall risk framework, and assists the Board in the monitoring, review and approval of the policies that measure, limit and manage the Corporation’s risks, including cybersecurity risk.
The CSD develops the Information Security Program, which considers and evaluates risks posed by cybersecurity threats, events and activities impacting the industry and the Corporation.
The CISP develops the Information Security Program, which considers and evaluates risks posed by cybersecurity threats, events and activities impacting the industry and the Corporation.
Members of the CSD (including the CISO) and FORM Division report on and escalate cybersecurity, IT and privacy risks to management committees, such as the ITCRC, ORCO and ERM Committee, and, if appropriate, to the RMC and the Board of Directors, as required under relevant policies and procedures.
Members of the CISP (including the CISO) and FORM Division report on and escalate cybersecurity, IT and privacy risks to management committees, such as the ITCRC, ORCO and ERM Committees, and, if appropriate, to the RMC, TC, and the Board of Directors, as required under relevant policies and procedures.
The second line of defense is made up of members of the Corporation’s Corporate Risk Management Group and the Corporate Security Group (the “CSG”) who, among other things, measure and report on the Corporation’s risk activities.
The second line of defense is made up of members of the Corporation’s Corporate Risk Management Group and the Corporate Security and Operations Group (the “CSOG”) who, among other things, measure and report on the Corporation’s risk activities.
Popular’s Outsourced Risk Management Policy outlines the management of risks associated with the Corporation’s use of third- party service providers, and the CSG assesses the impact and level of cybersecurity and privacy risk of such providers.
Popular’s Third Party Risk Management Policy outlines the management of risks associated with the Corporation’s use of third-party service providers, and the CSOG assesses the impact and level of cybersecurity and privacy risk of such providers.
Prior to that, she served as Senior Vice President and General Auditor of the Corporation from November 2012 to April 2018. Before 2012, she served in various risk related functions of the Corporation and as the Chief Operating Officer and Chief Financial Officer of Popular’s broker dealer business.
Prior to that, she served as Senior Vice President and General Auditor of the Corporation from November 2012 to April 2018. Before 2012, she served in various risk related functions of the Corporation and as the Chief Operating Officer and Chief Financial Officer of Popular’s broker dealer business. The CISO has over 30 years of work experience.
He holds a BS with a major in Computer Engineering and an MBA with majors in Finance and Accounting. The FORM Division Manager has over 29 years of work experience. She holds the title of Senior Vice President and FORM Division Manager and has been in her role since March 2022.
He holds a BS with a major in Computer Engineering and an MBA with majors in Finance and Accounting. 40 The FORM Division Manager has over 30 years of work experience. She holds the title of Senior Vice President and FORM Division Manager and has been in her role since January 2026.
The RMC is also responsible for (i) overseeing the development, implementation and maintenance of the Corporation’s information security program (the “Information Security Program”); (ii) approving the Corporation’s risk management program and any related policies and controls; (iii) overseeing the implementation by the Corporation’s management of the Corporation’s risk management program and any related policies, procedures and controls; and (iv) reviewing reports regarding selected topics such as cyber.
The RMC is also responsible for (i) overseeing the development, implementation and maintenance of the Corporation’s information security program (the “Information Security Program”); (ii) approving the Corporation’s risk management program and any related policies and controls; (iii) overseeing the implementation by the Corporation’s management of the Corporation’s risk management program and any related policies, procedures and controls; (iv) overseeing the Corporation’s risk management with respect to emerging technologies, including artificial intelligence; and (v) reviewing reports regarding selected topics such as cyber.
The CSG operates under the direction of the Chief Security Officer. The Chief Security Officer has over 36 years of experience, including over 12 years of professional experience in information technology and cybersecurity matters such as the oversight of the Information Security Program and the design and execution of the information security audit plan of the Corporation.
The Chief Security Officer has over 37 years of experience, including over 13 years of professional experience in information technology and cybersecurity matters such as the oversight of the Information Security Program and the design and execution of the information security audit plan of the Corporation.
Meanwhile, Popular’s Cyber Security Division (the “CSD”), which is headed by the CISO and reports to the CSG, is responsible for the development of strategies, policies and programs to assess and mitigate cybersecurity risks.
Meanwhile, Popular’s Corporate Information Security and Privacy Division (the “CISP”), which is headed by the CISO and reports to the CSOG, is responsible for the development of strategies, policies and programs to assess and mitigate cybersecurity and privacy risks.
In 2025, we will transition to the Cyber Risk Institute (“CRI”) Profile 2.0 assessment framework, following the announcement by the FFIEC of the sunset of the CAT in 2025.
In 2025, we began the transition to the Cyber Risk Institute (“CRI”) Profile 2.0 assessment framework, following the announcement by the FFIEC of the sunset of the CAT. The transition to the CRI framework is expected to be completed in 2026.
He holds the title of Executive Vice President and Chief Risk Officer and has been in his role since 2011. Prior to joining the Corporation, he served for 17 years as Chief Financial Officer, Head of Retail Bank and Mortgage Operations, Head of Commercial and Construction Mortgage and Head of Interest Rate Risk, among other positions, for other banks.
Prior to joining the Corporation, he served for 17 years as Chief Financial Officer, Head of Retail Bank and Mortgage Operations, Head of Commercial and Construction Mortgage and Head of Interest Rate Risk, among other positions, for other banks.
He holds the title of CISO and Cybersecurity Division Manager and has been in this role since 2019. 40 The Corporate Risk Management Group operates under the direction of the Chief Risk Officer. The Chief Risk Officer has over 31 years of work experience.
The Corporate Risk Management Group operates under the direction of the Chief Risk Officer. The Chief Risk Officer has over 32 years of work experience. He holds the title of Executive Vice President and Chief Risk Officer and has been in his role since 2011.
She holds a BBA with majors in Accounting and Information Systems, and a Master of Science in Information Technology Management.
Before 2022, she held positions for 18 years as Operational and IT Risk Director, Head of ERM and Operational Risk, and Chief Information Security Officer for other financial institutions. She holds a BBA with majors in Accounting and Information Systems, and a Master of Science in Information Technology Management.
Removed
The CISO has over 26 years of work experience in various roles in major financial institutions involving leading top-level cybersecurity governance strategy and initiatives, integrating security governance into the overall business strategy and advising boards of directors on cyber risks and cybersecurity standards. He has been a certified information security professional since 2007.
Added
In addition, the Board also has a standing Technology Committee (the “TC”) that oversees the Corporation’s technology functions, strategy, operations, investments and needs. The TC meets at least quarterly and our Chief Information and Digital Strategy Officer and our Chief Security Officer generally participate in such meetings.
Removed
Prior to that she held positions for 16 years as Operational and IT Risk Director, Head of ERM and Operational Risk, and Chief Information Security Officer for other banks. She also held positions in Internal Audit and IT Management for other industries throughout her career.
Added
The TC (i) oversees the development and implementation of the Corporation’s technology strategy and initiatives, (ii) monitors the risks associated with critical technology vendor relationships, including cyber risks, and (iii) reviews and receives reports from management and third parties regarding the Corporation’s technology functions, operations, strategy and initiatives, as well as current and emerging technology trends and risks arising therefrom.
Added
For a description of how identified cybersecurity threats may affect Popular’s business strategy or results, see under the headings “We and our third-party providers have been, and expect in the future to continue to be, subject to cyber-attacks.
Added
To date, previous cybersecurity incidents have not materially affected our results of operations or financial condition. The CSOG operates under the direction of the Chief Security Officer.
Added
She holds the title of Senior Vice President and Corporate Chief Information Security Officer and assumed this role in January 2026. Prior to this role, since 2022, she served as Senior Vice President and Financial and Operational Risk Management Division Manager, with oversight of the enterprise and operational risks of the Corporation.
Added
Prior to this role, since 2018, she held the position of Senior Vice President and Division Manager of the Corporate Risk Reviews Division reporting directly to the RMC. She has leadership experience in treasury management, investment strategy and enterprise risk oversight.
Added
She holds a BSBA with majors in Finance and International Business and an MBA with concentrations in Finance and Management.

Item 2. Properties

Properties — owned and leased real estate

3 edited+0 added−0 removed3 unchanged
Biggest changePonce de León 167 Building, a five-story office building located in Hato Rey, Puerto Rico. U.S. & British Virgin Islands BPPR Virgin Islands Center, a three-story building located in St. Thomas, U.S. Virgin Islands. Popular Center -Tortola, a four-story building located in Tortola, British Virgin Islands. 41 ITEM 3.
Biggest changePonce de León 167 Building, a five-story office building located in Hato Rey, Puerto Rico. Muñoz Rivera 200, a ten-story building located in Hato Rey, Puerto Rico. U.S. & British Virgin Islands BPPR Virgin Islands Center, a three-story building located in St. Thomas, U.S. Virgin Islands.
ITEM 2. PROPERTIES As of December 31, 2024, BPPR operated 162 branches, of which 68 were owned and 94 were leased premises, and PB operated 40 branches of which 3 were owned and 37 were on leased premises. Also, the Corporation had 579 ATMs operating in Puerto Rico, 24 in the Virgin Islands and 99 in the U.S. Mainland.
ITEM 2. PROPERTIES As of December 31, 2025, BPPR operated 162 branches, of which 67 were owned and 95 were leased premises, and PB operated 39 branches of which 3 were owned and 36 were on leased premises. Also, the Corporation had 582 ATMs operating in Puerto Rico, 27 in the Virgin Islands and 97 in the U.S. Mainland.
LEGAL PROCEEDINGS For a discussion of Legal proceedings, see Note 23, “Commitments and Contingencies”, to the Consolidated Financial Statements in this Form 10-K.
Popular Center -Tortola, a four-story building located in Tortola, British Virgin Islands. 41 ITEM 3. LEGAL PROCEEDINGS For a discussion of Legal proceedings, see Note 23, “Commitments and Contingencies”, to the Consolidated Financial Statements in this Form 10-K.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

575 edited+178 added−241 removed478 unchanged
Biggest changeConsumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 1,188,119 $ - $ 1,188,119 Substandard - - - - - - 29,960 - 29,960 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,218,079 $ - $ 1,218,079 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 69,731 $ - $ 69,731 HELOCs Pass $ - $ - $ - $ - $ - $ 5,914 $ 52,573 $ 11,691 $ 70,178 Substandard - - - - - 1,657 15 700 2,372 Loss - - - - - 122 - 899 1,021 Total HELOCs $ - $ - $ - $ - $ - $ 7,693 $ 52,588 $ 13,290 $ 73,571 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 433 $ - $ 433 Personal Pass $ 751,032 $ 522,688 $ 303,193 $ 109,773 $ 29,729 $ 92,511 $ - $ 23,802 $ 1,832,728 Substandard 1,081 5,364 4,188 1,355 278 8,507 - 1,626 22,399 Loss 53 10 - 6 - 48 - - 117 Total Personal $ 752,166 $ 528,062 $ 307,381 $ 111,134 $ 30,007 $ 101,066 $ - $ 25,428 $ 1,855,244 Year-to-Date gross write-offs $ 3,164 $ 43,729 $ 48,946 $ 13,280 $ 2,939 $ 3,832 $ - $ 1,982 $ 117,872 Auto Pass $ 1,277,016 $ 938,769 $ 665,431 $ 494,529 $ 254,621 $ 133,054 $ - $ - $ 3,763,420 Substandard 7,239 16,876 13,579 10,775 6,377 5,131 - - 59,977 Loss 14 15 - 2 - 9 - - 40 Total Auto $ 1,284,269 $ 955,660 $ 679,010 $ 505,306 $ 260,998 $ 138,194 $ - $ - $ 3,823,437 Year-to-Date gross write-offs $ 11,229 $ 36,992 $ 20,486 $ 9,997 $ 4,965 $ 1,731 $ - $ - $ 85,400 Other consumer Pass $ 28,543 $ 29,585 $ 20,021 $ 10,129 $ 4,588 $ 3,364 $ 74,215 $ - $ 170,445 Substandard - 228 44 - 29 57 425 - 783 Loss - - - 550 - - - - 550 Total Other consumer $ 28,543 $ 29,813 $ 20,065 $ 10,679 $ 4,617 $ 3,421 $ 74,640 $ - $ 171,778 Year-to-Date gross write-offs $ 29 $ 213 $ 130 $ 96 $ 128 $ 2,205 $ 101 $ - $ 2,902 Total Popular Inc. $ 6,557,710 $ 5,969,119 $ 5,840,909 $ 4,086,973 $ 2,347,966 $ 8,740,425 $ 3,525,832 $ 38,718 $ 37,107,652 177 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total BPPR Commercial: Commercial multi-family Pass $ 37,976 $ 138,619 $ 21,334 $ 20,487 $ 32,554 $ 24,248 $ 306 $ - $ 275,524 Watch - - - - 1,068 5,179 - - 6,247 Special Mention - 559 - - - 4,780 - - 5,339 Substandard - - - - - 4,832 - - 4,832 Total commercial multi-family $ 37,976 $ 139,178 $ 21,334 $ 20,487 $ 33,622 $ 39,039 $ 306 $ - $ 291,942 Commercial real estate non-owner occupied Pass $ 305,243 $ 871,191 $ 560,785 $ 359,853 $ 41,262 $ 563,794 $ 7,042 $ - $ 2,709,170 Watch 1,959 882 5,205 22,211 5,938 27,015 - - 63,210 Special Mention 43,020 5,413 24,730 - 15,843 68,368 - - 157,374 Substandard 1,016 1,307 180 2,231 53,729 12,968 4,069 - 75,500 Total commercial real estate non- owner occupied $ 351,238 $ 878,793 $ 590,900 $ 384,295 $ 116,772 $ 672,145 $ 11,111 $ - $ 3,005,254 Year-to-Date gross write-offs $ - $ - $ - $ 609 $ - $ 521 $ - $ - $ 1,130 Commercial real estate owner occupied Pass $ 92,234 $ 155,819 $ 227,246 $ 51,038 $ 24,184 $ 357,429 $ 9,146 $ - $ 917,096 Watch 2,947 45,106 9,913 4,285 5,017 62,217 1,000 - 130,485 Special Mention - 16,860 20,741 1,462 887 44,069 - - 84,019 Substandard 1,316 15,710 5,080 143,696 845 87,383 12,617 - 266,647 Doubtful - - - - - 136 - - 136 Total commercial real estate owner occupied $ 96,497 $ 233,495 $ 262,980 $ 200,481 $ 30,933 $ 551,234 $ 22,763 $ - $ 1,398,383 Year-to-Date gross write-offs $ - $ 4 $ - $ - $ 1 $ 4,432 $ - $ - $ 4,437 Commercial and industrial Pass $ 1,109,898 $ 634,401 $ 511,912 $ 241,452 $ 123,458 $ 258,872 $ 1,343,885 $ - $ 4,223,878 Watch 28,841 95,785 6,111 4,043 15,560 65,360 182,756 - 398,456 Special Mention 6,401 3,269 276 3,200 2,088 41,289 9,410 - 65,933 Substandard 731 1,760 8,644 22,065 1,922 32,087 40,670 - 107,879 Doubtful - - - 54 - 26 - - 80 Total commercial and industrial $ 1,145,871 $ 735,215 $ 526,943 $ 270,814 $ 143,028 $ 397,634 $ 1,576,721 $ - $ 4,796,226 Year-to-Date gross write-offs $ 896 $ 184 $ 215 $ 335 $ 555 $ 1,086 $ 4,468 $ - $ 7,739 Construction Pass $ 26,662 $ 24,462 $ 27,364 $ 10,758 $ 1,944 $ 1,049 $ 38,720 $ - $ 130,959 Watch - 16,546 5,458 - - - 9,506 - 31,510 Special Mention - - 1,009 - - - 1 - 1,010 Substandard - 6,378 - - - - - - 6,378 Total construction $ 26,662 $ 47,386 $ 33,831 $ 10,758 $ 1,944 $ 1,049 $ 48,227 $ - $ 169,857 Year-to-Date gross write-offs $ - $ 2,611 $ - $ - $ - $ - $ - $ - $ 2,611 Mortgage Pass $ 751,532 $ 439,373 $ 421,297 $ 259,412 $ 164,438 $ 4,280,509 $ - $ - $ 6,316,561 Substandard 96 161 162 345 2,606 71,893 - - 75,263 Total mortgage $ 751,628 $ 439,534 $ 421,459 $ 259,757 $ 167,044 $ 4,352,402 $ - $ - $ 6,391,824 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 1,638 $ - $ - $ 1,638 178 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total BPPR Leasing Pass $ 647,659 $ 488,506 $ 313,133 $ 163,189 $ 88,983 $ 21,706 $ - $ - $ 1,723,176 Substandard 806 2,516 3,053 906 818 517 - - 8,616 Loss - - - - - 17 - - 17 Total leasing $ 648,465 $ 491,022 $ 316,186 $ 164,095 $ 89,801 $ 22,240 $ - $ - $ 1,731,809 Year-to-Date gross write-offs $ 1,065 $ 4,424 $ 2,878 $ 849 $ 976 $ 687 $ - $ - $ 10,879 Consumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 1,112,447 $ - $ 1,112,447 Substandard - - - - - - 23,259 - 23,259 Loss - - - - - - 22 - 22 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,135,728 $ - $ 1,135,728 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 41,007 $ - $ 41,007 HELOCs Pass $ - $ - $ - $ - $ - $ - $ 2,622 $ - $ 2,622 Substandard - - - - - - 26 - 26 Total HELOCs $ - $ - $ - $ - $ - $ - $ 2,648 $ - $ 2,648 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 213 $ - $ 213 Personal Pass $ 859,434 $ 480,771 $ 181,483 $ 57,227 $ 58,849 $ 96,956 $ - $ 22,034 $ 1,756,754 Substandard 1,815 4,985 1,939 493 933 8,322 - 1,006 19,493 Loss - - 14 - 12 37 - - 63 Total Personal $ 861,249 $ 485,756 $ 183,436 $ 57,720 $ 59,794 $ 105,315 $ - $ 23,040 $ 1,776,310 Year-to-Date gross write-offs $ 4,458 $ 35,915 $ 18,076 $ 4,210 $ 4,891 $ 2,952 $ - $ 1,475 $ 71,977 Auto Pass $ 1,210,622 $ 899,797 $ 711,439 $ 405,768 $ 260,355 $ 120,318 $ - $ - $ 3,608,299 Substandard 6,980 14,049 11,916 9,157 7,051 3,199 - - 52,352 Loss 9 44 45 16 9 6 - - 129 Total Auto $ 1,217,611 $ 913,890 $ 723,400 $ 414,941 $ 267,415 $ 123,523 $ - $ - $ 3,660,780 Year-to-Date gross write-offs $ 10,170 $ 23,849 $ 11,820 $ 5,914 $ 3,553 $ - $ - $ - $ 55,306 Other consumer Pass $ 36,144 $ 24,238 $ 14,942 $ 5,618 $ 3,433 $ 2,753 $ 61,796 $ - $ 148,924 Substandard 244 25 - 73 16 131 249 - 738 Loss - - 137 - - 363 - - 500 Total Other consumer $ 36,388 $ 24,263 $ 15,079 $ 5,691 $ 3,449 $ 3,247 $ 62,045 $ - $ 150,162 Year-to-Date gross write-offs $ 47 $ 154 $ 125 $ 164 $ 88 $ 11,876 $ - $ - $ 12,454 Total BPPR $ 5,173,585 $ 4,388,532 $ 3,095,548 $ 1,789,039 $ 913,802 $ 6,267,828 $ 2,859,549 $ 23,040 $ 24,510,923 179 December 31, 2023 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2023 2022 2021 2020 2019 Prior Years Total Popular U.S.
Biggest changeConsumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 1,188,119 $ - $ 1,188,119 Substandard - - - - - - 29,960 - 29,960 Total credit cards $ - $ - $ - $ - $ - $ - $ 1,218,079 $ - $ 1,218,079 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 69,731 $ - $ 69,731 HELOCs Pass $ - $ - $ - $ - $ - $ 5,914 $ 52,573 $ 11,691 $ 70,178 Substandard - - - - - 1,657 15 700 2,372 Loss - - - - - 122 - 899 1,021 Total HELOCs $ - $ - $ - $ - $ - $ 7,693 $ 52,588 $ 13,290 $ 73,571 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 433 $ - $ 433 Personal Pass $ 751,032 $ 522,688 $ 303,193 $ 109,773 $ 29,729 $ 92,511 $ - $ 23,802 $ 1,832,728 Substandard 1,081 5,364 4,188 1,355 278 8,507 - 1,626 22,399 Loss 53 10 - 6 - 48 - - 117 Total Personal $ 752,166 $ 528,062 $ 307,381 $ 111,134 $ 30,007 $ 101,066 $ - $ 25,428 $ 1,855,244 Year-to-Date gross write-offs $ 3,164 $ 43,729 $ 48,946 $ 13,280 $ 2,939 $ 3,832 $ - $ 1,982 $ 117,872 Auto Pass $ 1,277,016 $ 938,769 $ 665,431 $ 494,529 $ 254,621 $ 133,054 $ - $ - $ 3,763,420 Substandard 7,239 16,876 13,579 10,775 6,377 5,131 - - 59,977 Loss 14 15 - 2 - 9 - - 40 Total Auto $ 1,284,269 $ 955,660 $ 679,010 $ 505,306 $ 260,998 $ 138,194 $ - $ - $ 3,823,437 Year-to-Date gross write-offs $ 11,229 $ 36,992 $ 20,486 $ 9,997 $ 4,965 $ 1,731 $ - $ - $ 85,400 Other consumer Pass $ 28,543 $ 29,585 $ 20,021 $ 10,129 $ 4,588 $ 3,364 $ 74,215 $ - $ 170,445 Substandard - 228 44 - 29 57 425 - 783 Loss - - - 550 - - - - 550 Total Other consumer $ 28,543 $ 29,813 $ 20,065 $ 10,679 $ 4,617 $ 3,421 $ 74,640 $ - $ 171,778 Year-to-Date gross write-offs $ 29 $ 213 $ 130 $ 96 $ 128 $ 2,205 $ 101 $ - $ 2,902 Total Popular Inc. $ 6,557,710 $ 5,969,119 $ 5,840,909 $ 4,086,973 $ 2,347,966 $ 8,740,425 $ 3,525,832 $ 38,718 $ 37,107,652 186 Note 9 – Mortgage banking activities Income from mortgage banking activities includes mortgage servicing fees earned in connection with administering residential mortgage loans and valuation adjustments on mortgage servicing rights.
In Puerto Rico, the Corporation provides retail, mortgage, and commercial banking services through its principal banking subsidiary, Banco Popular de Puerto Rico (“BPPR”), as well as broker-dealer, auto and equipment leasing and financing, and insurance services through specialized subsidiaries.
In Puerto Rico, the Corporation provides retail, mortgage, as well as commercial banking services as well as auto and equipment leasing and financing, through its principal banking subsidiary, Banco Popular de Puerto Rico (“BPPR”), and broker-dealer and insurance services through specialized subsidiaries.
Adjusted net income - Non-GAAP Financial Measure In addition to analyzing the Corporation’s results on a reported basis, management monitors whether the impact of certain non- recurring or infrequent transactions need to be excluded from the results of operations to present what is then considered the “adjusted net income” of the Corporation.
Adjusted net income - Non-GAAP Financial Measure In addition to analyzing the Corporation’s results on a reported basis, management monitors whether the impact of certain non- recurring or infrequent transactions need to be excluded from the results of operations to present what is then considered to be “adjusted net income” of the Corporation.
The Corporation establishes an ACL for its loan portfolio based on its estimate of credit losses over the remaining contractual term of the loans, adjusted for expected prepayments, in accordance with Accounting Standards Codification (“ASC”) Topic 326.
The Corporation establishes an ACL for its loan portfolio based on its estimate of expected credit losses over the remaining contractual term of the loans, adjusted for expected prepayments, in accordance with Accounting Standards Codification (“ASC”) Topic 326.
The objective of effective liquidity management is to ensure that the Corporation has sufficient liquidity to meet all of its financial obligations, finance expected future growth, fund planned capital distributions and maintain a reasonable safety margin for cash needs under both normal and stressed market conditions.
The objective of effective liquidity management is to ensure that the Corporation has sufficient liquidity to meet all its financial obligations, finance expected future growth, fund planned capital distributions and maintain a reasonable safety margin for cash needs under both normal and stressed market conditions.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
The fair value of the collateral is based on appraisals, which may be adjusted due to their age, and the type, location, and condition of the property or area or general market conditions to reflect the expected change in value between the effective date of the appraisal and the measurement date.
The fair value of the collateral is based on appraisals, which may be adjusted due to their age, and the type, location, and condition of the property or area or general market conditions to reflect the expected change in value between the effective date of the appraisal and the measurement date.
Treasury securities. The Corporation applies a zero -credit loss assumption for these securities, and no ACL has been established for these securities given that U.S. Treasury securities carry an explicit guarantee from the U.S. Government, are highly rated by major rating agencies, and have a long history of no credit losses.
The Corporation applies a zero-credit loss assumption for these securities, and no ACL has been established for these securities given that U.S. Treasury securities carry an explicit guarantee from the U.S. Government, are highly rated by major rating agencies, and have a long history of no credit losses.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Popular U.S.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Popular U.S.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first. The recorded investment as of period end is inclusive of all partial paydowns and charge-offs since the modification date.
Such events could include, among others, a significant adverse change in the business climate, an adverse action by a regulator, an unanticipated change in the competitive environment and a decision to change the operations or dispose of a reporting unit.
Such events could include, among others, a significant adverse change in the business climate, an adverse action by a regulator, an unanticipated change in the competitive environment and a decision to change the operations or dispose of a reporting unit.
The impairment was measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations.
The impairment was measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations.
Costs to sell are excluded from the reported fair value amount. [2] Represents the fair value of foreclosed real estate and other collateral owned that were written down to their fair value. Costs to sell are excluded from the reported fair value amount.
Costs to sell are excluded from the reported fair value amount. [2] Represents the fair value of foreclosed real estate and other collateral owned that were written down to their fair value. Costs to sell are excluded from the reported fair value amount.
The impairment was measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations.
The impairment was measured based on the fair value of the collateral, which is derived from appraisals that take into consideration prices in observed transactions involving similar assets in similar locations.
Commercial: Commercial multi-family Pass $ 189,754 $ 185,634 $ 627,843 $ 334,549 $ 227,461 $ 594,900 $ 5,805 $ - $ 2,165,946 Watch - 10,974 27,982 26,679 10,668 116,020 - - 192,323 Special Mention - - 8,004 - - 3,161 - - 11,165 Substandard - - 2,761 - - 27,425 - - 30,186 Total commercial multi-family $ 189,754 $ 196,608 $ 666,590 $ 361,228 $ 238,129 $ 741,506 $ 5,805 $ - $ 2,399,620 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 441 $ - $ - $ 441 Commercial real estate non-owner occupied Pass $ 597,555 $ 691,595 $ 1,308,459 $ 715,513 $ 528,369 $ 981,777 $ 14,747 $ - $ 4,838,015 Watch 26,097 15,228 17,779 18,487 74,696 115,314 372 - 267,973 Special Mention 7,018 41,274 156 406 - 46,984 - - 95,838 Substandard - 1,002 2,767 29,171 7,712 120,757 - - 161,409 Total commercial real estate non- owner occupied $ 630,670 $ 749,099 $ 1,329,161 $ 763,577 $ 610,777 $ 1,264,832 $ 15,119 $ - $ 5,363,235 Year-to-Date gross write-offs $ - $ - $ 69 $ - $ - $ 113 $ - $ - $ 182 Commercial real estate owner occupied Pass $ 436,227 $ 336,695 $ 338,819 $ 493,939 $ 81,665 $ 555,949 $ 14,883 $ - $ 2,258,177 Watch 14,002 28,251 78,266 39,357 21,191 140,457 3 - 321,527 Special Mention - 1,697 88,941 53,716 27,406 26,697 1,499 - 199,956 Substandard 455 1,651 37,629 6,468 144,257 174,571 13,021 - 378,052 Doubtful - - - - - 34 - - 34 Total commercial real estate owner occupied $ 450,684 $ 368,294 $ 543,655 $ 593,480 $ 274,519 $ 897,708 $ 29,406 $ - $ 3,157,746 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 2,947 $ - $ - $ 2,947 Commercial and industrial Pass $ 1,050,752 $ 1,186,326 $ 921,018 $ 626,924 $ 334,986 $ 838,466 $ 1,768,712 $ - $ 6,727,184 Watch 124,987 36,355 98,450 34,532 12,986 67,107 150,861 - 525,278 Special Mention 5,577 7,316 7,165 158,195 53 30,615 32,006 - 240,927 Substandard 8,339 30,496 37,558 4,398 14,821 24,745 127,754 - 248,111 Doubtful - - - - - 11 - - 11 Loss - - - - - - 51 - 51 Total commercial and industrial $ 1,189,655 $ 1,260,493 $ 1,064,191 $ 824,049 $ 362,846 $ 960,944 $ 2,079,384 $ - $ 7,741,562 Year-to-Date gross write-offs $ 2,202 $ 2,278 $ 521 $ 422 $ 3,049 $ 12,321 $ 7,740 $ - $ 28,533 175 December 31, 2024 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2024 2023 2022 2021 2020 Prior Years Total Popular, Inc.
Commercial: Commercial multi-family Pass $ 189,754 $ 185,634 $ 627,843 $ 334,549 $ 227,461 $ 594,900 $ 5,805 $ - $ 2,165,946 Watch - 10,974 27,982 26,679 10,668 116,020 - - 192,323 Special Mention - - 8,004 - - 3,161 - - 11,165 Substandard - - 2,761 - - 27,425 - - 30,186 Total commercial multi-family $ 189,754 $ 196,608 $ 666,590 $ 361,228 $ 238,129 $ 741,506 $ 5,805 $ - $ 2,399,620 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 441 $ - $ - $ 441 Commercial real estate non-owner occupied Pass $ 597,555 $ 691,595 $ 1,308,459 $ 715,513 $ 528,369 $ 981,777 $ 14,747 $ - $ 4,838,015 Watch 26,097 15,228 17,779 18,487 74,696 115,314 372 - 267,973 Special Mention 7,018 41,274 156 406 - 46,984 - - 95,838 Substandard - 1,002 2,767 29,171 7,712 120,757 - - 161,409 Total commercial real estate non- owner occupied $ 630,670 $ 749,099 $ 1,329,161 $ 763,577 $ 610,777 $ 1,264,832 $ 15,119 $ - $ 5,363,235 Year-to-Date gross write-offs $ - $ - $ 69 $ - $ - $ 113 $ - $ - $ 182 Commercial real estate owner occupied Pass $ 436,227 $ 336,695 $ 338,819 $ 493,939 $ 81,665 $ 555,949 $ 14,883 $ - $ 2,258,177 Watch 14,002 28,251 78,266 39,357 21,191 140,457 3 - 321,527 Special Mention - 1,697 88,941 53,716 27,406 26,697 1,499 - 199,956 Substandard 455 1,651 37,629 6,468 144,257 174,571 13,021 - 378,052 Doubtful - - - - - 34 - - 34 Total commercial real estate owner occupied $ 450,684 $ 368,294 $ 543,655 $ 593,480 $ 274,519 $ 897,708 $ 29,406 $ - $ 3,157,746 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ 2,947 $ - $ - $ 2,947 Commercial and industrial Pass $ 1,050,752 $ 1,186,326 $ 921,018 $ 626,924 $ 334,986 $ 838,466 $ 1,768,712 $ - $ 6,727,184 Watch 124,987 36,355 98,450 34,532 12,986 67,107 150,861 - 525,278 Special Mention 5,577 7,316 7,165 158,195 53 30,615 32,006 - 240,927 Substandard 8,339 30,496 37,558 4,398 14,821 24,745 127,754 - 248,111 Doubtful - - - - - 11 - - 11 Loss - - - - - - 51 - 51 Total commercial and industrial $ 1,189,655 $ 1,260,493 $ 1,064,191 $ 824,049 $ 362,846 $ 960,944 $ 2,079,384 $ - $ 7,741,562 Year-to-Date gross write-offs $ 2,202 $ 2,278 $ 521 $ 422 $ 3,049 $ 12,321 $ 7,740 $ - $ 28,533 184 December 31, 2024 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2024 2023 2022 2021 2020 Prior Years Total Popular, Inc.
Eliminations Interest income $ 2,631,407 $ 627,600 $ (16,432) Interest expense 819,752 276,955 (16,434) Net interest income 1,811,655 350,645 2 Provision for credit losses 194,325 14,584 - Non-interest income 586,677 24,868 (404) Personnel costs 571,516 102,994 - Professional fees 79,108 17,410 (401) Technology and software expenses 232,652 31,890 - Processing and transactional services 135,528 2,521 - Amortization of intangibles 1,937 1,243 - Goodwill impairment charge - 23,000 - Depreciation expense 49,135 7,888 - Other operating expenses [1] 544,767 99,438 (3) Total operating expenses 1,614,643 286,384 (404) Income before income tax 589,364 74,545 2 Income tax expense 117,412 18,198 - Net income $ 471,952 $ 56,347 $ 2 Segment assets $ 57,023,071 $ 13,812,158 $ (426,058) December 31, 2023 Reportable Total (In thousands) Segments Corporate Eliminations Popular, Inc.
Eliminations Interest income $ 2,631,407 $ 627,600 $ (16,432) Interest expense 819,752 276,955 (16,434) Net interest income 1,811,655 350,645 2 Provision for credit losses (benefit) 194,325 14,584 - Non-interest income 586,677 24,868 (404) Personnel costs 571,516 102,994 - Professional fees 79,108 17,410 (401) Technology and software expenses 232,652 31,890 - Processing and transactional services 135,528 2,521 - Amortization of intangibles 1,937 1,243 - Goodwill impairment charge - 23,000 - Depreciation expense 49,135 7,888 - Other operating expenses [1] 544,767 99,438 (3) Total operating expenses 1,614,643 286,384 (404) Income before income tax 589,364 74,545 2 Income tax expense (benefit) 117,412 18,198 - Net income $ 471,952 $ 56,347 $ 2 Segment assets $ 57,023,071 $ 13,812,158 $ (426,058) December 31, 2023 Reportable Total (In thousands) Segments Corporate Eliminations Popular, Inc.
Construction Pass $ 322,301 $ 565,498 $ 188,691 $ 14,908 $ 9,483 $ 1,776 $ 16,782 $ - $ 1,119,439 Watch - 15,413 36,264 - - 7,172 24,691 - 83,540 Special Mention - 4,897 6,367 6,058 - - - - 17,322 Substandard - - 8,104 576 - 25,473 9,338 - 43,491 Total construction $ 322,301 $ 585,808 $ 239,426 $ 21,542 $ 9,483 $ 34,421 $ 50,811 $ - $ 1,263,792 Mortgage Pass $ 977,420 $ 813,171 $ 624,733 $ 674,021 $ 450,511 $ 4,467,834 $ - $ - $ 8,007,690 Substandard - 2,605 1,437 2,535 347 99,569 - - 106,493 Total mortgage $ 977,420 $ 815,776 $ 626,170 $ 676,556 $ 450,858 $ 4,567,403 $ - $ - $ 8,114,183 Year-to-Date gross write-offs $ - $ 9 $ - $ 8 $ - $ 1,085 $ - $ - $ 1,102 Leasing Pass $ 731,053 $ 477,226 $ 362,426 $ 217,537 $ 104,812 $ 22,762 $ - $ - $ 1,915,816 Substandard 1,195 2,280 2,834 1,885 920 402 - - 9,516 Loss - - - - - 73 - - 73 Total leasing $ 732,248 $ 479,506 $ 365,260 $ 219,422 $ 105,732 $ 23,237 $ - $ - $ 1,925,405 Year-to-Date gross write-offs $ 1,733 $ 4,842 $ 5,373 $ 3,281 $ 694 $ 1,052 $ - $ - $ 16,975 176 December 31, 2024 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2024 2023 2022 2021 2020 Prior Years Total Popular, Inc.
Construction Pass $ 322,301 $ 565,498 $ 188,691 $ 14,908 $ 9,483 $ 1,776 $ 16,782 $ - $ 1,119,439 Watch - 15,413 36,264 - - 7,172 24,691 - 83,540 Special Mention - 4,897 6,367 6,058 - - - - 17,322 Substandard - - 8,104 576 - 25,473 9,338 - 43,491 Total construction $ 322,301 $ 585,808 $ 239,426 $ 21,542 $ 9,483 $ 34,421 $ 50,811 $ - $ 1,263,792 Mortgage Pass $ 977,420 $ 813,171 $ 624,733 $ 674,021 $ 450,511 $ 4,467,834 $ - $ - $ 8,007,690 Substandard - 2,605 1,437 2,535 347 99,569 - - 106,493 Total mortgage $ 977,420 $ 815,776 $ 626,170 $ 676,556 $ 450,858 $ 4,567,403 $ - $ - $ 8,114,183 Year-to-Date gross write-offs $ - $ 9 $ - $ 8 $ - $ 1,085 $ - $ - $ 1,102 Leasing Pass $ 731,053 $ 477,226 $ 362,426 $ 217,537 $ 104,812 $ 22,762 $ - $ - $ 1,915,816 Substandard 1,195 2,280 2,834 1,885 920 402 - - 9,516 Loss - - - - - 73 - - 73 Total leasing $ 732,248 $ 479,506 $ 365,260 $ 219,422 $ 105,732 $ 23,237 $ - $ - $ 1,925,405 Year-to-Date gross write-offs $ 1,733 $ 4,842 $ 5,373 $ 3,281 $ 694 $ 1,052 $ - $ - $ 16,975 185 December 31, 2024 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2024 2023 2022 2021 2020 Prior Years Total Popular, Inc.
Provision for Beginning credit losses - Ending (In thousands) Balance (benefit) Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 10,126 $ (3,243) $ (441) $ 11 $ 6,453 Commercial real estate non-owner occupied 11,699 (2,533) (54) 530 9,642 Commercial real estate owner occupied 16,227 (3,721) (154) 121 12,473 Commercial and industrial 14,779 4,304 (3,978) 765 15,870 Total Commercial 52,831 (5,193) (4,627) 1,427 44,438 Construction 7,392 1,029 - 100 8,521 Mortgage 10,774 (1,381) (18) 133 9,508 Consumer Home equity lines of credit 1,875 (1,181) (53) 808 1,449 Personal 16,609 11,278 (19,203) 2,756 11,440 Other 2 61 (101) 40 2 Total Consumer 18,486 10,158 (19,357) 3,604 12,891 Total - Loans $ 89,483 $ 4,613 $ (24,002) $ 5,264 $ 75,358 Allowance for credit losses - unfunded commitments: Commercial $ 1,851 $ (189) $ - $ - $ 1,662 Construction 8,446 (3,037) - - 5,409 Consumer 29 (18) - - 11 Ending balance - unfunded commitments [1] $ 10,326 $ (3,244) $ - $ - $ 7,082 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. 155 For the year ended December 31, 2024 Popular Inc.
Provision for Beginning credit losses Ending (In thousands) Balance (benefit) Charge-offs Recoveries Balance Allowance for credit losses - loans: Commercial Commercial multi-family $ 10,126 $ (3,243) $ (441) $ 11 $ 6,453 Commercial real estate non-owner occupied 11,699 (2,533) (54) 530 9,642 Commercial real estate owner occupied 16,227 (3,721) (154) 121 12,473 Commercial and industrial 14,779 4,304 (3,978) 765 15,870 Total Commercial 52,831 (5,193) (4,627) 1,427 44,438 Construction 7,392 1,029 - 100 8,521 Mortgage 10,774 (1,381) (18) 133 9,508 Consumer Home equity lines of credit 1,875 (1,181) (53) 808 1,449 Personal 16,609 11,278 (19,203) 2,756 11,440 Other 2 61 (101) 40 2 Total Consumer 18,486 10,158 (19,357) 3,604 12,891 Total - Loans $ 89,483 $ 4,613 $ (24,002) $ 5,264 $ 75,358 Allowance for credit losses - unfunded commitments: Commercial $ 1,851 $ (189) $ - $ - $ 1,662 Construction 8,446 (3,037) - - 5,409 Consumer 29 (18) - - 11 Ending balance - unfunded commitments [1] $ 10,326 $ (3,244) $ - $ - $ 7,082 [1] Allowance for credit losses of unfunded commitments is presented as part of Other Liabilities in the Consolidated Statements of Financial Condition. 156 For the year ended December 31, 2024 Popular Inc.
Treasury securities 8,172,345 7,693,418 - 7,693,418 - 69,594 7,623,824 1.39 Obligations of Puerto Rico, States and political subdivisions Within 1 year 2,440 2,440 5 2,435 3 - 2,438 6.39 After 1 to 5 years 16,454 16,454 80 16,374 47 80 16,341 3.69 After 5 to 10 years 655 655 22 633 20 - 653 5.81 After 10 years 37,633 37,633 5,210 32,423 2,318 2,596 32,145 1.42 Total obligations of Puerto Rico, States and political subdivisions 57,182 57,182 5,317 51,865 2,388 2,676 51,577 2.34 Collateralized mortgage obligations - federal agencies After 10 years 1,518 1,518 - 1,518 - 214 1,304 2.87 Total collateralized mortgage obligations - federal agencies 1,518 1,518 - 1,518 - 214 1,304 2.87 Securities in wholly owned statutory business trusts After 5 to 10 years 5,959 5,959 - 5,959 - - 5,959 6.33 Total securities in wholly owned statutory business trusts 5,959 5,959 - 5,959 - - 5,959 6.33 Total debt securities held-to-maturity [2] $ 8,237,004 $ 7,758,077 $ 5,317 $ 7,752,760 $ 2,388 $ 72,484 $ 7,682,664 1.40 % [1] Book value includes $ 479 million of net unrealized loss which remains in Accumulated other comprehensive (loss) income (AOCI) related to certain securities previously transferred from available-for-sale securities portfolio to the held-to-maturity securities portfolio. [2] Includes $ 7.6 billion pledged to secure public and trust deposits that the secured parties are not permitted to sell or repledge the collateral.
Treasury securities 8,172,345 7,693,418 - 7,693,418 - 69,594 7,623,824 1.39 Obligations of Puerto Rico, States and political subdivisions ` Within 1 year 2,440 2,440 5 2,435 3 - 2,438 6.39 After 1 to 5 years 16,454 16,454 80 16,374 47 80 16,341 3.69 After 5 to 10 years 655 655 22 633 20 - 653 5.81 After 10 years 37,633 37,633 5,210 32,423 2,318 2,596 32,145 1.42 Total obligations of Puerto Rico, States and political subdivisions 57,182 57,182 5,317 51,865 2,388 2,676 51,577 2.34 Collateralized mortgage obligations - federal agencies After 10 years 1,518 1,518 - 1,518 - 214 1,304 2.87 Total collateralized mortgage obligations - federal agencies 1,518 1,518 - 1,518 - 214 1,304 2.87 Securities in wholly owned statutory business trusts After 5 to 10 years 5,959 5,959 - 5,959 - - 5,959 6.33 Total securities in wholly owned statutory business trusts 5,959 5,959 - 5,959 - - 5,959 6.33 Total debt securities held-to-maturity [2] $ 8,237,004 $ 7,758,077 $ 5,317 $ 7,752,760 $ 2,388 $ 72,484 $ 7,682,664 1.40 % [1] Book value includes $ 479 million of unrealized loss which remains in Accumulated other comprehensive (loss) income (AOCI) related to certain securities transferred from available-for-sale securities portfolio to the held-to-maturity securities portfolio. [2] Includes $ 7.6 billion pledged to secure public and trust deposits that the secured parties are not permitted to sell or repledge the collateral.
Past due Past due 90 days or more 30-59 60-89 90 days Total Non-accrual Accruing (In thousands) days days or more past due Current Loans HIP loans loans Commercial multi-family $ - $ 5,443 $ 8,700 $ 14,143 $ 2,077,476 $ 2,091,619 $ 8,700 $ - Commercial real estate: Non-owner occupied 6,792 - 8,015 14,807 2,101,925 2,116,732 8,015 - Owner occupied - - 5,191 5,191 1,776,644 1,781,835 5,191 - Commercial and industrial 10,336 5,323 1,938 17,597 2,377,071 2,394,668 1,748 190 Construction - - - - 1,051,502 1,051,502 - - Mortgage 18,148 5,417 29,890 53,455 1,250,847 1,304,302 29,890 - Consumer: Credit cards - - - - 26 26 - - Home equity lines of credit 530 986 3,393 4,909 66,622 71,531 3,393 - Personal 1,808 1,509 1,741 5,058 99,809 104,867 1,741 - Other 514 - 11 525 11,024 11,549 11 - Total $ 38,128 $ 18,678 $ 58,879 $ 115,685 $ 10,812,946 $ 10,928,631 $ 58,689 $ 190 144 December 31, 2024 Popular, Inc.
Past due Past due 90 days or more 30-59 60-89 90 days Total Non-accrual Accruing (In thousands) days days or more past due Current Loans HIP loans loans Commercial multi-family $ - $ 5,443 $ 8,700 $ 14,143 $ 2,077,476 $ 2,091,619 $ 8,700 $ - Commercial real estate: Non-owner occupied 6,792 - 8,015 14,807 2,101,925 2,116,732 8,015 - Owner occupied - - 5,191 5,191 1,776,644 1,781,835 5,191 - Commercial and industrial 10,336 5,323 1,938 17,597 2,377,071 2,394,668 1,748 190 Construction - - - - 1,051,502 1,051,502 - - Mortgage 18,148 5,417 29,890 53,455 1,250,847 1,304,302 29,890 - Consumer: Credit cards - - - - 26 26 - - Home equity lines of credit 530 986 3,393 4,909 66,622 71,531 3,393 - Personal 1,808 1,509 1,741 5,058 99,809 104,867 1,741 - Other 514 - 11 525 11,024 11,549 11 - Total $ 38,128 $ 18,678 $ 58,879 $ 115,685 $ 10,812,946 $ 10,928,631 $ 58,689 $ 190 146 December 31, 2024 Popular, Inc.
Consumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 26 $ - $ 26 Total credit cards $ - $ - $ - $ - $ - $ - $ 26 $ - $ 26 HELOCs Pass $ - $ - $ - $ - $ - $ 5,914 $ 50,533 $ 11,691 $ 68,138 Substandard - - - - - 1,657 15 700 2,372 Loss - - - - - 122 - 899 1,021 Total HELOCs $ - $ - $ - $ - $ - $ 7,693 $ 50,548 $ 13,290 $ 71,531 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 53 $ - $ 53 Personal Pass $ 28,083 $ 23,084 $ 41,182 $ 8,618 $ 651 $ 1,507 $ - $ - $ 103,125 Substandard 157 399 627 134 7 302 - - 1,626 Loss 53 10 - 5 - 48 - - 116 Total Personal $ 28,293 $ 23,493 $ 41,809 $ 8,757 $ 658 $ 1,857 $ - $ - $ 104,867 Year-to-Date gross write-offs $ 802 $ 4,536 $ 10,869 $ 2,458 $ 231 $ 307 $ - $ - $ 19,203 Other consumer Pass $ - $ - $ - $ - $ - $ - $ 11,537 $ - $ 11,537 Substandard - - - - - - 12 - 12 Total Other consumer $ - $ - $ - $ - $ - $ - $ 11,549 $ - $ 11,549 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 101 $ - $ 101 Total Popular U.S. $ 1,271,148 $ 1,743,796 $ 2,211,046 $ 1,506,705 $ 1,040,610 $ 2,726,041 $ 415,995 $ 13,290 $ 10,928,631 174 December 31, 2024 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2024 2023 2022 2021 2020 Prior Years Total Popular, Inc.
Consumer: Credit cards Pass $ - $ - $ - $ - $ - $ - $ 26 $ - $ 26 Total credit cards $ - $ - $ - $ - $ - $ - $ 26 $ - $ 26 HELOCs Pass $ - $ - $ - $ - $ - $ 5,914 $ 50,533 $ 11,691 $ 68,138 Substandard - - - - - 1,657 15 700 2,372 Loss - - - - - 122 - 899 1,021 Total HELOCs $ - $ - $ - $ - $ - $ 7,693 $ 50,548 $ 13,290 $ 71,531 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 53 $ - $ 53 Personal Pass $ 28,083 $ 23,084 $ 41,182 $ 8,618 $ 651 $ 1,507 $ - $ - $ 103,125 Substandard 157 399 627 134 7 302 - - 1,626 Loss 53 10 - 5 - 48 - - 116 Total Personal $ 28,293 $ 23,493 $ 41,809 $ 8,757 $ 658 $ 1,857 $ - $ - $ 104,867 Year-to-Date gross write-offs $ 802 $ 4,536 $ 10,869 $ 2,458 $ 231 $ 307 $ - $ - $ 19,203 Other consumer Pass $ - $ - $ - $ - $ - $ - $ 11,537 $ - $ 11,537 Substandard - - - - - - 12 - 12 Total Other consumer $ - $ - $ - $ - $ - $ - $ 11,549 $ - $ 11,549 Year-to-Date gross write-offs $ - $ - $ - $ - $ - $ - $ 101 $ - $ 101 Total Popular U.S. $ 1,271,148 $ 1,743,796 $ 2,211,046 $ 1,506,705 $ 1,040,610 $ 2,726,041 $ 415,995 $ 13,290 $ 10,928,631 183 December 31, 2024 Term Loans Revolving Loans Amortized Cost Basis Revolving Loans Converted to Term Loans Amortized Cost Basis Amortized Cost Basis by Origination Year (In thousands) 2024 2023 2022 2021 2020 Prior Years Total Popular, Inc.
Additionally, contingency funding plans are used to model various stressful events of different magnitudes that affect different time horizons, to assist management in evaluating the size of the liquidity buffers needed if those stress events occur. However, such models may not predict accurately how the market and customers might react to every event and are dependent on many assumptions.
Additionally, contingency funding plans are used to model various stress events of different magnitudes that affect different time horizons, to assist management in evaluating the size of the liquidity buffers needed if those events occur. However, such models may not predict accurately how the market and customers might react to every event and are dependent on many assumptions.
The amount allocated to continuing operations is the tax effect of the pre-tax income or loss from continuing operations that occurred during the year, plus or minus income tax effects of (a) changes in circumstances that 129 cause a change in judgment about the realization of deferred tax assets in future years, (b) changes in tax laws or rates, (c) changes in tax status, and (d) tax-deductible dividends paid to stockholders, subject to certain exceptions.
The amount allocated to continuing operations is the tax effect of the pre-tax income or loss from continuing operations that occurred during the year, plus or minus income tax effects of (a) changes in circumstances that cause a change in judgment about the realization of deferred tax assets in future years, (b) changes in tax laws or rates, (c) changes in tax status, and (d) tax-deductible dividends paid to stockholders, subject to certain exceptions.
In the U.S. mainland, the Corporation provides retail, mortgage, and commercial banking services, as well as equipment leasing and financing, through its New York -chartered banking subsidiary, Popular Bank (“PB” or “Popular U.S.”), which has branches located in New York, New Jersey and Florida. Note 36 to the Consolidated Financial Statements presents information about the Corporation’s business segments.
In the U.S. mainland, the Corporation provides retail and commercial banking services, as well as equipment leasing and financing, through its New York-chartered banking subsidiary, Popular Bank (“PB” or “Popular U.S.”), which has branches located in New York, New Jersey and Florida. Note 36 to the Consolidated Financial Statements presents information about the Corporation’s business segments.
(Dollars in thousands) BPPR % of Total Popular U.S. % of Total (Consolidated) % of Total Deposits: Deposits balances under $250,000 [1] $ 23,588,937 44 % $ 7,961,334 68 % $ 31,550,271 49 % Transactional deposits balances over $250,000 8,046,175 15 % 1,944,674 16 % 9,990,849 15 % Time deposits balances over $250,000 1,991,934 4 % 813,424 7 % 2,805,358 4 % Uninsured foreign deposits 450,068 1 % - - % 450,068 1 % Collateralized public funds 19,771,083 36 % 316,716 3 % 20,087,799 31 % Intercompany deposits 205,839 - % 667,839 6 % - - % Total deposits $ 54,054,036 100 % $ 11,703,987 100 % $ 64,884,345 100 % [1] Includes the first $250,000 in balances of transactional and time deposit accounts with balances in excess of $250,000. 31-Dec-23 Popular, Inc.
(Dollars in thousands) BPPR % of Total Popular U.S. % of Total (Consolidated) % of Total Deposits Deposits balances under $250,000 [1] $ 23,588,937 44 % $ 7,961,334 68 % $ 31,550,271 49 % Transactional deposits balances over $250,000 8,046,175 15 % 1,944,674 16 % 9,990,849 15 % Time deposits balances over $250,000 1,991,934 4 % 813,424 7 % 2,805,358 4 % Uninsured foreign deposits 450,068 1 % - - % 450,068 1 % Collateralized public funds 19,771,083 36 % 316,716 3 % 20,087,799 31 % Intercompany deposits 205,839 - % 667,839 6 % - - % Total deposits $ 54,054,036 100 % $ 11,703,987 100 % $ 64,884,345 100 % [1] Includes the first $250,000 in balances of transactional and time deposit accounts with balances in excess of $250,000.
In addition, at December 31, 2024 and December 31, 2023, the Corporation had placed $ 0.3 billion of the available FHLB credit facility as collateral for municipal letters of credit to secure deposits. The FHLB borrowing facilities are collateralized with securities and loans held-in-portfolio, and do not have restrictive covenants or callable features.
In addition, at December 31, 2024, the Corporation had placed $ 0.3 billion of the available FHLB credit facility as collateral for municipal letters of credit to secure deposits. The FHLB borrowing facilities are collateralized with securities and loans held-in-portfolio, and do not have restrictive covenants or callable features.
The ACL also includes a qualitative framework that addresses two main components: losses that are expected but not captured within the quantitative modeling framework and model imprecision. In order to identify potential losses that are not captured through the models, management evaluates model limitations as well as the different risks covered by the variables used in each quantitative model.
The ACL also includes a qualitative adjustment framework that addresses two main components: losses that are expected but not captured within the quantitative modeling framework and model imprecision. In order to identify potential losses that are not captured through the models, management evaluates model limitations as well as the different risks covered by the variables used in each quantitative model.
Expected loss rates are applied to different loan segmentations. The expected loss, which represents the amount expected to be lost on a given loan, considers the probability of default and loss severity. The reserve for the estimated losses under the credit recourse arrangements is presented separately within other liabilities in the Consolidated Statements of Financial Condition.
Expected loss rates are applied to different loan segmentations. The expected 127 loss, which represents the amount expected to be lost on a given loan, considers the probability of default and loss severity. The reserve for the estimated losses under the credit recourse arrangements is presented separately within other liabilities in the Consolidated Statements of Financial Condition.
Servicing agreements relating to the mortgage-backed securities programs of FNMA and GNMA, and to mortgage loans sold or serviced to certain other investors, including FHLMC, require the Corporation to advance funds to make scheduled payments of principal, interest, taxes and insurance, if such payments have not been received from the borrowers.
Servicing agreements relating to the mortgage-backed securities programs of FNMA, FHMLC and GNMA, and to mortgage loans sold or serviced to certain other investors, including FHLMC, require the Corporation to advance funds to make scheduled payments of principal, interest, taxes and insurance, if such payments have not been received from the borrowers.
Revenues from contract with customers Refer to Note 31 for a detailed description of the Corporation’s policies on the recognition and presentation of revenues from contract with customers. Foreign exchange Assets and liabilities denominated in foreign currencies are translated to U.S. dollars using prevailing rates of exchange at the end of the period.
Revenues from contracts with customers Refer to Note 31 for a detailed description of the Corporation’s policies on the recognition and presentation of revenues from contract with customers. Foreign exchange Assets and liabilities denominated in foreign currencies are translated to U.S. dollars using prevailing rates of exchange at the end of the period.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. 169 Payment default is defined as a restructured loan becoming 90 days past due after being modified, foreclosed or charged-off, whichever occurs first.
Interest income $ 3,670,308 $ 12,589 $ (9,634) $ 3,673,263 Interest expense 1,357,740 42,869 (9,634) 1,390,975 Net interest income (expense) 2,312,568 (30,280) - 2,282,288 Provision for credit losses 256,212 730 - 256,942 Non-interest income 622,453 41,046 (4,590) 658,909 Personnel costs 706,600 113,851 - 820,451 Professional fees 71,193 55,608 (979) 125,822 Technology and software expenses 292,468 36,593 - 329,061 Processing and transactional services 142,655 22 - 142,677 Amortization of intangibles 2,938 - - 2,938 Depreciation expense 55,518 1,560 - 57,078 Other operating expenses [1] 612,315 (199,165) (3,540) 409,610 Total operating expenses 1,883,687 8,469 (4,519) 1,887,637 Income before income tax 795,122 1,567 (71) 796,618 Income tax expense 161,756 20,609 41 182,406 Net income (loss) $ 633,366 $ (19,042) $ (112) $ 614,212 Segment assets $ 72,670,209 $ 5,895,389 $ (5,520,215) $ 73,045,383 [1] Other operating expenses includes net occupancy expenses, equipment expense, excluding depreciation, other operating taxes, communications expense, business promotion expenses, deposit insurance costs and OREO expenses. 259 December 31, 2023 Intersegment (In thousands) BPPR Popular U.S.
Interest income $ 3,670,308 $ 12,589 $ (9,634) $ 3,673,263 Interest expense 1,357,740 42,869 (9,634) 1,390,975 Net interest income (expense) 2,312,568 (30,280) - 2,282,288 Provision for credit losses (benefit) 256,212 730 - 256,942 Non-interest income 622,453 41,046 (4,590) 658,909 Personnel costs 706,600 113,851 - 820,451 Professional fees 71,193 55,608 (979) 125,822 Technology and software expenses 292,468 36,593 - 329,061 Processing and transactional services 142,655 22 - 142,677 Amortization of intangibles 2,938 - - 2,938 Depreciation expense 55,518 1,560 - 57,078 Other operating expenses [1] 612,315 (199,165) (3,540) 409,610 Total operating expenses 1,883,687 8,469 (4,519) 1,887,637 Income before income tax 795,122 1,567 (71) 796,618 Income tax expense (benefit) 161,756 20,609 41 182,406 Net income $ 633,366 $ (19,042) $ (112) $ 614,212 Segment assets $ 72,670,209 $ 5,895,389 $ (5,520,215) $ 73,045,383 [1] Other operating expenses includes net occupancy expenses, equipment expense, excluding depreciation, other operating taxes, communications expense, business promotion expenses, deposit insurance costs and OREO expenses. 255 December 31, 2023 Intersegment (In thousands) BPPR Popular U.S.
Refer to Note 22 to the Consolidated Financial Statements for further disclosures on guarantees. Treasury stock 128 Treasury stock is recorded at cost and is carried as a reduction of stockholders’ equity in the Consolidated Statements of Financial Condition. At the date of retirement or subsequent reissue, the treasury stock account is reduced by the cost of such stock.
Refer to Note 22 to the Consolidated Financial Statements for further disclosures on guarantees. Treasury stock Treasury stock is recorded at cost and is carried as a reduction of stockholders’ equity in the Consolidated Statements of Financial Condition. At the date of retirement or subsequent reissue, the treasury stock account is reduced by the cost of such stock.
Eliminations Interest income $ 2,926,996 $ 753,912 $ (10,600) Interest expense 970,430 397,910 (10,600) Net interest income 1,956,566 356,002 - Provision for credit losses 254,843 1,369 - Non-interest income 596,262 26,247 (56) Personnel costs 601,652 104,948 - Professional fees 58,687 12,562 (56) Technology and software expenses 254,584 37,884 - Processing and transactional services 140,293 2,362 - Amortization of intangibles 1,696 1,242 - Depreciation expense 47,019 8,499 - Other operating expenses [1] 510,108 102,207 - Total operating expenses 1,614,039 269,704 (56) Income before income tax 683,946 111,176 - Income tax expense 128,207 33,549 - Net income $ 555,739 $ 77,627 $ - Segment assets $ 58,601,802 $ 14,333,292 $ (264,885) December 31, 2024 Reportable Total (In thousands) Segments Corporate Eliminations Popular, Inc.
Eliminations Interest income $ 2,926,996 $ 753,912 $ (10,600) Interest expense 970,430 397,910 (10,600) Net interest income 1,956,566 356,002 - Provision for credit losses 254,843 1,369 - Non-interest income 596,262 26,247 (56) Personnel costs 601,652 104,948 - Professional fees 58,687 12,562 (56) Technology and software expenses 254,584 37,884 - Processing and transactional services 140,293 2,362 - Amortization of intangibles 1,696 1,242 - Depreciation expense 47,019 8,499 - Other operating expenses [1] 510,108 102,207 - Total operating expenses 1,614,039 269,704 (56) Income before income tax 683,946 111,176 - Income tax expense 128,207 33,549 - Net income $ 555,739 $ 77,627 $ - Segment assets $ 58,601,802 $ 14,333,292 $ (264,885) For the year ended December 31, 2024 Reportable Total (In thousands) Segments Corporate Eliminations Popular, Inc.
In these scenarios, the Corporation’s financial flexibility and ability to grow revenues may not increase proportionately to cover costs and profitability would be adversely affected. The Corporation considers balances in excess of $250,000 to have a higher potential liquidity risk.
In these scenarios, the Corporation’s financial flexibility and ability to grow revenues may not increase proportionately to cover costs and profitability would be adversely affected. 85 The Corporation considers balances in excess of $250,000 to have a higher potential liquidity risk.
The following tables show the amortized cost basis of the loans modified to borrowers experiencing financial difficulties at the end of the reporting period disaggregated by class of financing receivable and type of concession granted for the years ended December 31, 2024 and December 31, 2023.
The following tables show the amortized cost basis of the loans modified to borrowers experiencing financial difficulties at the end of the reporting period disaggregated by class of financing receivable and type of concession granted for the years ended December 31, 2025, 2024, and 2023.
Other real estate owned and other foreclosed assets Other real estate owned includes real estate properties securing mortgage, consumer, and commercial loans. Other foreclosed assets include primarily automobiles securing auto loans. The fair value of foreclosed assets may be determined using an external 231 appraisal, broker price opinion, or an internal valuation.
Other real estate owned and other foreclosed assets Other real estate owned includes real estate properties securing mortgage, consumer, and commercial loans. Other foreclosed assets include primarily automobiles securing auto loans. The fair value of foreclosed assets may be determined using an external appraisal, broker price opinion, or an internal valuation.
Off-Balance Sheet Arrangements and Other Commitments In the ordinary course of business, the Corporation engages in financial transactions that are not recorded on the balance sheet or may be recorded on the balance sheet in amounts that are different than the full contract or notional amount of the transaction.
Off-Balance Sheet Arrangements and Other Commitments 88 In the ordinary course of business, the Corporation engages in financial transactions that are not recorded on the balance sheet or may be recorded on the balance sheet in amounts that are different than the full contract or notional amount of the transaction.
The ERM Committee and the Enterprise Risk Management Department in the Financial and Operational Risk Management Division (the “FORM Division”), in coordination with the Chief Risk Officer, create the framework to identify and manage multiple and cross-enterprise risks, and to articulate the RAS and supporting metrics.
The ERM Committee and the Enterprise Risk Management Department in the Financial and Operational Risk Management Division (the “FORM Division”), in coordination with the Chief Risk Officer (“CRO”), create the framework to identify and manage multiple and cross-enterprise risks, and to articulate the RAS and supporting metrics.
The performance shares vest at the end of the three-year performance cycle. If a participant terminates employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service, the performance shares shall continue outstanding and vest at the end of the performance cycle.
The performance shares will vest at the end of the three-year performance cycle. If a participant terminates employment after attaining the earlier of 55 years of age and 10 years of service or 60 years of age and 5 years of service, the performance shares shall continue outstanding and vest at the end of the performance cycle.
Accordingly, the embedded options and the related indexed options are marked-to-market through earnings. 221 Note 26 – Related party transactions The Corporation has had loan transactions with the Corporation’s directors, executive officers, including certain related individuals or organizations, and affiliates, and proposes to continue such transactions in the ordinary course of its business, on substantially the same terms, including interest rates and collateral, as those prevailing for comparable loan transactions with third parties.
Accordingly, the embedded options and the related indexed options are marked-to-market through earnings. 218 Note 26 – Related party transactions The Corporation has had loan transactions with the Corporation’s directors, executive officers, including certain related individuals or organizations, and affiliates, and proposes to continue such transactions in the ordinary course of its business, on substantially the same terms, including interest rates and collateral, as those prevailing for comparable loan transactions with third parties.
Other 230 CMOs, due to their limited liquidity, are classified as Level 3 due to the insufficiency of inputs such as executed trades, credit information and cash flows. ● Corporate securities (included as “other” in the “available-for-sale” category): Given that the quoted prices are for similar instruments, these securities are classified as Level 2. ● Corporate securities and interest-only strips (included as “other” in the “trading account debt securities” category): For corporate securities, quoted prices for these security types are obtained from broker dealers.
Other CMOs, due to their limited liquidity, are classified as Level 3 due to the insufficiency of inputs such as executed trades, credit information and cash flows. 226 ● Corporate securities (included as “other” in the “available-for-sale” category): Given that the quoted prices are for similar instruments, these securities are classified as Level 2. ● Corporate securities and interest-only strips (included as “other” in the “trading account debt securities” category): For corporate securities, quoted prices for these security types are obtained from broker dealers.
They also supervise Popular’s reporting obligations under the compliance program to assess the adequacy, consistency and timeliness of the reporting of compliance- related risks across the Corporation. 104 The Regulatory Affairs team is responsible for maintaining an open dialog with the banking regulatory agencies to have regulatory risks properly identified, measured, monitored, as well as communicated to the appropriate regulatory agency as necessary to keep them apprised of material matters within the purview of these agencies.
They also supervise Popular’s reporting obligations under the compliance program to assess the adequacy, consistency and timeliness of the reporting of compliance- related risks across the Corporation. 103 The Regulatory Affairs team is responsible for maintaining an open dialog with the banking regulatory agencies to have regulatory risks properly identified, measured, monitored, as well as communicated to the appropriate regulatory agency as necessary to keep them apprised of material matters within the purview of these agencies.
The fair value of commitments to extend credit and letters of credit, which are based on the fees charged to enter into those agreements, are not material to Popular’s financial statements. 235 Note 29 – Employee benefits Certain employees of BPPR are covered by three non-contributory defined benefit pension plans, the Banco Popular de Puerto Rico Retirement Plan and two Restoration Plans (the “Pension Plans”).
The fair value of commitments to extend credit and letters of credit, which are based on the fees charged to enter into those agreements, are not material to Popular’s financial statements. 230 Note 29 – Employee benefits Certain employees of BPPR are covered by three non-contributory defined benefit pension plans, the Banco Popular de Puerto Rico Retirement Plan and two Restoration Plans (the “Pension Plans”).
If sufficient information is not available to determine if price quotes are based on orderly transactions, less weight should be given to the price quote relative to other transactions that are known to be orderly. 121 Investment securities Investment securities are classified in four categories and accounted for as follows: ● Debt securities that the Corporation has the intent and ability to hold to maturity are classified as debt securities held-to- maturity and reported at amortized cost.
If sufficient information is not available to determine if price quotes are based on orderly transactions, less weight should be given to the price quote relative to other transactions that are known to be orderly. 120 Investment securities Investment securities are classified in four categories and accounted for as follows: ● Debt securities that the Corporation has the intent and ability to hold to maturity are classified as debt securities held-to- maturity and reported at amortized cost.
Year ended December 31, 2023 (In thousands) Level 1 Level 2 Level 3 Total NONRECURRING FAIR VALUE MEASUREMENTS Assets Write-downs Loans [1] $ - $ - $ 10,091 $ 10,091 $ (3,157) Other real estate owned [2] - - 6,560 6,560 (1,516) Other foreclosed assets [2] - - 102 102 (28) Total assets measured at fair value on a nonrecurring basis $ - $ - $ 16,753 $ 16,753 $ (4,701) [1] Relates mainly to certain impaired collateral dependent loans.
Year ended December 31, 2023 (In thousands) Level 1 Level 2 Level 3 Total NONRECURRING FAIR VALUE MEASUREMENTS Assets Write-downs Loans [1] $ - $ - $ 10,091 $ 10,091 $ (3,157) Other real estate owned [2] - - 6,560 6,560 (1,516) Other foreclosed assets [2] - - 102 102 (28) Total assets measured at fair value on a nonrecurring basis $ - $ - $ 16,753 $ 16,753 $ (4,701) [1] Relates mostly to certain impaired collateral dependent loans.
A 50 basis point decrease to each of the rates in the December 31, 2024 Willis Towers Watson RATE: Link (10/90) Model would increase the projected 2025 expense for the Banco Popular de Puerto Rico Retirement Plan by approximately $1.8 million. The change would not affect the minimum required contribution to the Pension Plans.
A 50 basis point decrease to each of the rates in the December 31, 2025 Willis Towers Watson RATE: Link (10/90) Model would increase the projected 2026 expense for the Banco Popular de Puerto Rico Retirement Plan by approximately $1.8 million. The change would not affect the minimum required contribution to the Pension Plans.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. 166 Popular Inc.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Popular Inc.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. 168 Popular Inc.
Loans modified with financial difficulty that were fully paid down, charged-off or foreclosed upon by period end are not reported. Popular Inc.
Management has determined that at December 31, 2024 and 2023, the Corporation exceeded all capital adequacy requirements to which it is subject. The Corporation has been designated by the Federal Reserve Board as a Financial Holding Company (“FHC”) and is eligible to engage in certain financial activities permitted under the Gramm-Leach-Bliley Act of 1999.
Management has determined that at December 31, 2025 and 2024, the Corporation exceeded all capital adequacy requirements to which it is subject. The Corporation has been designated by the Federal Reserve Board as a Financial Holding Company (“FHC”) and is eligible to engage in certain financial activities permitted under the Gramm-Leach-Bliley Act of 1999.
This process is reevaluated at least on an annual basis and if market, actuarial and economic conditions change, adjustments to the rate of return may come into place. The Pension Plans weighted average asset allocation as of December 31, 2024 and 2023 and the approved asset allocation ranges, by asset category, are summarized in the table below.
This process is reevaluated at least on an annual basis and if market, actuarial and economic conditions change, adjustments to the rate of return may come into place. The Pension Plans weighted average asset allocation as of December 31, 2025 and 2024 and the approved asset allocation ranges, by asset category, are summarized in the table below.
(Dollars in thousands) Amortized Cost Basis at December 31, 2024 % of total class of Financing Receivable Amortized Cost Basis at December 31, 2024 % of total class of Financing Receivable Amortized Cost Basis at December 31, 2024 % of total class of Financing Receivable CRE non-owner occupied $ 885 0.03 % $ - - % $ 885 0.02 % CRE owner occupied 143,886 10.46 % - - % 143,886 4.56 % Commercial and industrial 644 0.01 % - - % 644 0.01 % Mortgage 14,674 0.22 % 66 0.01 % 14,740 0.18 % Consumer: Personal 8,662 0.49 % 329 0.31 % 8,991 0.48 % Total $ 168,751 0.64 % $ 395 - % $ 169,146 0.46 % 160 Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction Puerto Rico Popular U.S.
(Dollars in thousands) Amortized Cost Basis at December 31, 2024 % of total class of Financing Receivable Amortized Cost Basis at December 31, 2024 % of total class of Financing Receivable Amortized Cost Basis at December 31, 2024 % of total class of Financing Receivable CRE non-owner occupied $ 885 0.03 % $ - - % $ 885 0.02 % CRE owner occupied 143,886 10.46 % - - % 143,886 4.56 % Commercial and industrial 644 0.01 % - - % 644 0.01 % Mortgage 14,674 0.22 % 66 0.01 % 14,740 0.18 % Consumer: Personal 8,662 0.49 % 329 0.31 % 8,991 0.48 % Total $ 168,751 0.64 % $ 395 - % $ 169,146 0.46 % 160 Combination - Other-Than-Insignificant Payment Delays and Interest Rate Reduction BPPR Popular U.S.
As part of the review, the Corporation’s independent consulting actuaries performed an analysis of expected returns based on each plan’s expected asset allocation for the year 2025 using the Willis Towers Watson US Expected Return Estimator. This analysis is reviewed by the Corporation and used as a tool to develop expected rates of return, together with other data.
As part of the review, the Corporation’s independent consulting actuaries performed an analysis of expected returns based on each plan’s expected asset allocation for the year 2026 using the Willis Towers Watson US Expected Return Estimator. This analysis is reviewed by the Corporation and used as a tool to develop expected rates of return, together with other data.
All loan sales performed during the years ended December 31, 2024 and 2023 were without credit recourse agreements. The Corporation recognizes as assets the rights to service loans for others, whether these rights are purchased or result from asset transfers such as sales and securitizations. These mortgage servicing rights (“MSRs”) are measured at fair value.
All loan sales performed during the years ended December 31, 2025 and 2024 were without credit recourse agreements. The Corporation recognizes as assets the rights to service loans for others, whether these rights are purchased or result from asset transfers such as sales and securitizations. These mortgage servicing rights (“MSRs”) are measured at fair value.
The Corporation does not anticipate a reduction in the total amount of unrecognized tax benefits within the next 12 months. The Corporation and its subsidiaries file income tax returns in Puerto Rico, the U.S. federal jurisdiction, various U.S. states and political subdivisions, and foreign jurisdictions. As of December 31, 2024, the following years remain subject to examination in the U.S.
The Corporation does not anticipate a reduction in the total amount of unrecognized tax benefits within the next 12 months. The Corporation and its subsidiaries file income tax returns in Puerto Rico, the U.S. federal jurisdiction, various U.S. states and political subdivisions, and foreign jurisdictions. As of December 31, 2025, the following years remain subject to examination in the U.S.
Newly originated mortgage loans held-for-sale are reported at fair value, with changes recorded through earnings. 123 The past due status of a loan is determined in accordance with its contractual repayment terms. Furthermore, loans are reported as past due when either interest or principal remains unpaid for 30 days or more in accordance with its contractual repayment terms.
Newly originated mortgage loans held-for-sale are reported at fair value, with changes recorded through earnings. 122 The past due status of a loan is determined in accordance with its contractual repayment terms. Furthermore, loans are reported as past due when either interest or principal remains unpaid for 30 days or more in accordance with its contractual repayment terms.
(Dollars in thousands) December 31, 2024 and 2023 Popular North America Popular Issuer Capital Trust I Capital Trust Il Capital securities $ 91,651 $ 101,024 Distribution rate 6.564 % 6.125 % Common securities $ 2,835 $ 3,124 Junior subordinated debentures aggregate liquidation amount $ 94,486 $ 104,148 Stated maturity date September 2034 December 2034 Reference notes [1],[3],[5] [2],[4],[5] [1] Statutory business trust that is wholly-owned by PNA and indirectly wholly-owned by the Corporation. [2] Statutory business trust that is wholly-owned by the Corporation. [3] The obligation of PNA under the junior subordinated debenture and its guarantees of the capital securities under the trust is fully and unconditionally guaranteed on a subordinated basis by the Corporation to the extent set forth in the guarantee agreement. [4] These capital securities are fully and unconditionally guaranteed on a subordinated basis by the Corporation to the extent set forth in the guarantee agreement. [5] The Corporation has the right, subject to any required prior approval from the Federal Reserve, to redeem after certain dates or upon the occurrence of certain events mentioned below, the junior subordinated debentures at a redemption price equal to 100% of the principal amount, plus accrued and unpaid interest to the date of redemption.
(Dollars in thousands) December 31, 2025 and 2024 Popular North America Popular Issuer Capital Trust I Capital Trust Il Capital securities $ 91,651 $ 101,023 Distribution rate 6.564 % 6.125 % Common securities $ 2,835 $ 3,125 Junior subordinated debentures aggregate liquidation amount $ 94,486 $ 104,148 Stated maturity date September 2034 December 2034 Reference notes [1],[3],[5] [2],[4],[5] [1] Statutory business trust that is wholly-owned by PNA and indirectly wholly-owned by the Corporation. [2] Statutory business trust that is wholly-owned by the Corporation. [3] The obligation of PNA under the junior subordinated debenture and its guarantees of the capital securities under the trust is fully and unconditionally guaranteed on a subordinated basis by the Corporation to the extent set forth in the guarantee agreement. [4] These capital securities are fully and unconditionally guaranteed on a subordinated basis by the Corporation to the extent set forth in the guarantee agreement. [5] The Corporation has the right, subject to any required prior approval from the Federal Reserve, to redeem after certain dates or upon the occurrence of certain events mentioned below, the junior subordinated debentures at a redemption price equal to 100% of the principal amount, plus accrued and unpaid interest to the date of redemption.
Loans held-for-sale have been allocated according to the expected sale date. 83 Trading The Corporation engages in trading activities in the ordinary course of business at its subsidiaries, BPPR, PB and Popular Securities. Popular Securities’ trading activities consist primarily of market-making activities to meet expected customers’ needs related to its retail brokerage business, and purchases and sales of U.S.
Loans held-for-sale have been allocated according to the expected sale date. Trading The Corporation engages in trading activities in the ordinary course of business at its subsidiaries, BPPR and Popular Securities. Popular Securities’ trading activities consist primarily of market-making activities to meet expected customers’ needs related to its retail brokerage business, and purchases and sales of U.S.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Corporation as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Corporation as of December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025 in conformity with accounting principles generally accepted in the United States of America.
Any losses incurred by a bank must first be charged to retained earnings and then to the reserve fund. Amounts credited to the reserve fund may not be used to pay dividends without the prior consent of the Puerto Rico Commissioner of Financial Institutions. The failure to maintain sufficient statutory reserves would preclude BPPR from paying dividends.
Any losses incurred by a bank must first be charged to retained earnings and then to the reserve fund. Amounts transferred to the reserve fund may not be used to pay dividends without the prior consent of the Puerto Rico Commissioner of Financial Institutions. The failure to maintain sufficient statutory reserves would preclude BPPR from paying dividends.
Consumer: Credit cards Added a weighted-average of 16 months to the life of loans. 164 For the year ended December 31, 2023 Interest rate reduction Loan Type Financial Effect Commercial multi-family Reduced weighted-average contractual interest rate from 7.5 % to 5.3 %. CRE Non-owner occupied Reduced weighted-average contractual interest rate from 9.1 % to 7.3 %.
Consumer: Credit cards Added a weighted-average of 16 months to the life of loans. 165 For the year ended December 31, 2023 Interest rate reduction Loan Type Financial Effect Commercial multi-family Reduced weighted-average contractual interest rate from 7.5 % to 5.3 %. CRE Non-owner occupied Reduced weighted-average contractual interest rate from 9.1 % to 7.3 %.
Investments measured at net asset value per share (“NAV”) as a practical expedient have not been classified in the fair value hierarchy, but are presented in order to permit reconciliation of the plans’ assets. 2024 2023 (In thousands) Level 1 Level 2 Level 3 Measured at NAV Total Level 1 Level 2 Level 3 Measured at NAV Total Obligations of the U.S.
Investments measured at net asset value per share (“NAV”) as a practical expedient have not been classified in the fair value hierarchy, but are presented in order to permit reconciliation of the plans’ assets. 2025 2024 (In thousands) Level 1 Level 2 Level 3 Measured at NAV Total Level 1 Level 2 Level 3 Measured at NAV Total Obligations of the U.S.
No interest income is recognized for these loans in accordance with the Corporation’s policy. Average balances exclude unrealized gains or losses on debt securities available-for-sale and unrealized losses on debt securities transfer to held-to-maturities. 108 Report of Management on Internal Control Over Financial Reporting The management of Popular, Inc.
No interest income is recognized for these loans in accordance with the Corporation’s policy. Average balances exclude unrealized gains or losses on debt securities available-for-sale and unrealized losses on debt securities transfer to held-to-maturities. 107 Report of Management on Internal Control Over Financial Reporting The management of Popular, Inc.
The Corporation had unpledged Available for Sale securities with a fair value of $ 4.6 billion that could be used to increase its borrowing facilities. The weighted average yield on debt securities available-for-sale is based on amortized cost; therefore, it does not give effect to changes in fair value.
The Corporation had unpledged Available for Sale securities with a fair value of $ 4.3 billion that could be used to increase its borrowing facilities. The weighted average yield on debt securities available-for-sale is based on amortized cost; therefore, it does not give effect to changes in fair value.
The Corporation is acting as principal since, as asset manager, it has the obligation to provide the specified service to the customer and has the ultimate discretion in establishing the fee paid by the customer for the specified services. 246 Note 32 – Leases The Corporation enters in the ordinary course of business into operating and finance leases for land, buildings and equipment.
The Corporation is acting as principal since, as asset manager, it has the obligation to provide the specified service to the customer and has the ultimate discretion in establishing the fee paid by the customer for the specified services. 241 Note 32 – Leases The Corporation enters in the ordinary course of business into operating and finance leases for land, buildings and equipment.
We believe that our audits provide a reasonable basis for our opinions. 110 Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
We believe that our audits provide a reasonable basis for our opinions. 109 Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles.
The expected maturities of collateralized mortgage obligations and certain other securities may differ from their contractual maturities because they may be subject to prepayments or may be called by the issuer. The following table presents the aggregate amortized cost and fair value of debt securities held-to-maturity at December 31, 2024 by contractual maturity.
The expected maturities of collateralized mortgage obligations and certain other securities may differ from their contractual maturities because they may be subject to prepayments or may be called by the issuer. The following table presents the aggregate amortized cost and fair value of debt securities held-to-maturity at December 31, 2025 by contractual maturity.
To the extent the loans do not meet specified characteristics, the Corporation may be required to repurchase such loans or indemnify for losses and bear any subsequent loss related to the loans. The amount purchased under representation and warranty arrangements during the years ended December 31, 2024 and December 31, 2023 was not considered material for the Corporation.
To the extent the loans do not meet specified characteristics, the Corporation may be required to repurchase such loans or indemnify for losses and bear any subsequent loss related to the loans. The amount purchased under representation and warranty arrangements during the years ended December 31, 2025 and December 31, 2024 was not considered material for the Corporation.
Refer to Note 17 to the consolidated financial statements for further information on the trust preferred securities. 212 Note 23 – Commitments and contingencies Off-balance sheet risk The Corporation is a party to financial instruments with off-balance sheet credit risk in the normal course of business to meet the financial needs of its customers.
Refer to Note 17 to the consolidated financial statements for further information on the trust preferred securities. 210 Note 23 – Commitments and contingencies Off-balance sheet risk The Corporation is a party to financial instruments with off-balance sheet credit risk in the normal course of business to meet the financial needs of its customers.
Also, the Corporation is involved with various special purpose entities mainly in guaranteed mortgage securitization transactions, including GNMA and FNMA. The Corporation has also engaged in securitization transactions with FHLMC, but considers its exposure in the form of servicing fees and servicing advances not to be significant at December 31, 2024.
Also, the Corporation is involved with various special purpose entities mainly in guaranteed mortgage securitization transactions, including GNMA and FNMA. The Corporation has also engaged in securitization transactions with FHLMC, but considers its exposure in the form of servicing fees and servicing advances not to be significant at December 31, 2025.
Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized in actual transactions. The fair values reflected herein have been determined based on the prevailing rate environment at December 31, 2024 and December 31, 2023, as applicable.
Many of these estimates involve various assumptions and may vary significantly from amounts that could be realized in actual transactions. The fair values reflected herein have been determined based on the prevailing rate environment at December 31, 2025 and December 31, 2024, as applicable.
Net interest income on a taxable equivalent basis Net interest income, on a taxable equivalent basis, is presented with its different components in Table 5 for the year ended December 31, 2024 as compared with the same period in 2023, segregated by major categories of interest earning assets and interest-bearing liabilities.
Net interest income on a taxable equivalent basis Net interest income, on a taxable equivalent basis, is presented with its different components in Table 5 for the year ended December 31, 2025 as compared with the same period in 2024, segregated by major categories of interest earning assets and interest-bearing liabilities.
Moreover, the manner in which the Corporation calculates its tangible common equity, tangible assets and other related measures may differ from that of other companies reporting measures with similar names. Table 12 provides a reconciliation of total stockholders’ equity to tangible common equity and total assets to tangible assets as of December 31, 2024, and December 31, 2023.
Moreover, the manner in which the Corporation calculates its tangible common equity, tangible assets and other related measures may differ from that of other companies reporting measures with similar names. Table 12 provides a reconciliation of total stockholders’ equity to tangible common equity and total assets to tangible assets as of December 31, 2025, and December 31, 2024.
The Corporation determined that the maximum exposure to loss includes the fair value of the MSRs and the assumption that the servicing advances at December 31, 2024 and 2023 will not be recovered. The agency debt securities are not included as part of the maximum exposure to loss since they are guaranteed by the related agencies.
The Corporation determined that the maximum exposure to loss includes the fair value of the MSRs and the assumption that the servicing advances at December 31, 2025 and 2024 will not be recovered. The agency debt securities are not included as part of the maximum exposure to loss since they are guaranteed by the related agencies.
Refer to Note 23 to the Consolidated Financial Statements for the notional amount of commitments to extend credit, which represents the unused portion of credit facilities granted to customers, and letters of credit, which represent the contractual amount that is required to be paid in the event of nonperformance, at December 31, 2024 and December 31, 2023.
Refer to Note 23 to the Consolidated Financial Statements for the notional amount of commitments to extend credit, which represents the unused portion of credit facilities granted to customers, and letters of credit, which represent the contractual amount that is required to be paid in the event of nonperformance, at December 31, 2025 and December 31, 2024.
In addition to regulatory limits previously discussed, the ability of a bank subsidiary to up-stream dividends to its BHC could thus be impacted by its financial performance and capital, including tangible and regulatory capital, thus potentially limiting the amount of cash moving up to the BHCs from the banking subsidiaries.
In addition to regulatory limits previously discussed, the ability of a bank subsidiary to up-stream dividends to its BHC could be impacted by its financial performance and capital, including tangible and regulatory capital, thus potentially limiting the amount of cash up streamed to the BHCs from the banking subsidiaries.

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Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeDuring the year ended December 31, 2024, the Corporation repurchased 2,256,420 shares of common stock for $217.3 million, at an average price of $96.32 per share. These actions resulted from a common stock repurchase authorization of up to $500 million announced on July 24, 2024.
Biggest changeDuring the year ended December 31, 2025, the Corporation repurchased 4,660,124 shares of common stock for $501.5 million, at an average price of $107.61 per common share, and during the year ended December 31, 2024, the Corporation repurchased 2,256,420 shares of common stock for $217.3 million, at an average price of $96.32 per common share.
Our ability to declare and pay dividends on the Preferred Stock is dependent on certain Federal regulatory considerations, including the guidelines of the Federal Reserve Board regarding capital adequacy and dividends. The Board of Directors is not obligated to declare dividends and dividends do not accumulate in the event they are not paid.
Our ability to declare and pay dividends on the Preferred Stock is dependent on certain Federal regulatory 42 considerations, including the guidelines of the Federal Reserve Board regarding capital adequacy and dividends. The Board of Directors is not obligated to declare dividends and dividends do not accumulate in the event they are not paid.
Comparison of Five-Year Cumulative Total Return (TSR) Assumes all dividends were reinvested Base Year: December 31, 2019 = $100 (1) Unless Popular specifically states otherwise, this Stock Performance Graph shall not be deemed to be incorporated by reference and shall not constitute soliciting material or otherwise be considered filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
Comparison of Five-Year Cumulative Total Return (TSR) Assumes all dividends were reinvested Base Year: December 31, 2020 = $100 (1) Unless Popular specifically states otherwise, this Stock Performance Graph shall not be deemed to be incorporated by reference and shall not constitute soliciting material or otherwise be considered filed under the Securities Act of 1933 or the Securities Exchange Act of 1934.
Stock Performance Graph (1) The graph below compares the cumulative total stockholder return during the measurement period with the cumulative total return, assuming reinvestment of dividends, of the Nasdaq Bank Index and the Nasdaq Composite Index.
Stock Performance Graph (1) 43 The graph below compares the cumulative total stockholder return during the measurement period with the cumulative total return, assuming reinvestment of dividends, of the Nasdaq Bank Index and the Nasdaq Composite Index.
Popular’s Preferred Stock issued and outstanding at December 31, 2024 consisted of: ● 885,726 shares of 6.375% non-cumulative monthly income Preferred Stock, Series A, no par value, liquidation preference value of $25 per share. All series of Preferred Stock are pari passu. Dividends on each series of Preferred Stock are payable if declared by our Board of Directors.
Popular’s Preferred Stock issued and outstanding at December 31, 2025 consisted of: ● 885,726 shares of 6.375% non-cumulative monthly income Preferred Stock, Series A, no par value, liquidation preference value of $25 per share. All series of Preferred Stock are pari passu. Dividends on each series of Preferred Stock are payable if declared by our Board of Directors.
The cumulative total stockholder return was obtained by dividing (i) the cumulative amount of dividends per share, assuming dividend reinvestment since the measurement point, December 31, 2019, plus (ii) the change in the per share price since the measurement date, by the share price at the measurement date.
The cumulative total stockholder return was obtained by dividing (i) the cumulative amount of dividends per share, assuming dividend reinvestment since the measurement point, December 31, 2020, plus (ii) the change in the per share price since the measurement date, by the share price at the measurement date.
Monthly dividends on the Preferred Stock amounted to a total of $1.4 million for the year 2024. There can be no assurance that any dividends will be declared on the Preferred Stock in any future periods.
Monthly dividends on the Preferred Stock amounted to a total of $1.4 million for the year 2025. There can be no assurance that any dividends will be declared on the Preferred Stock in any future periods.
The 2020 Incentive Plan replaced the Popular, Inc. 2004 Omnibus Incentive Plan, which was in effect prior to the adoption of the 2020 Incentive Plan. As of December 31, 2024, the maximum number of shares of common stock remaining available for future issuance under this plan was 2,896,568.
The 2020 Incentive Plan replaced the Popular, Inc. 2004 Omnibus Incentive Plan, which was in effect prior to the adoption of the 2020 Incentive Plan. As of December 31, 2025, the maximum number of shares of common stock remaining available for future issuance under this plan was 2,599,105.
During 2024, the Corporation declared cash dividends in the total amount of $2.56 per common share outstanding, for an aggregate amount of $183.9 million. The Common Stock ranks junior to all series of Preferred Stock as to dividend rights and rights on liquidation, dissolution or winding up of Popular.
During 2025, the Corporation declared cash dividends in the total amount of $2.90 per common share outstanding, for an aggregate amount of $196.2 million. The Common Stock ranks junior to all series of Preferred Stock as to dividend rights and rights on liquidation, dissolution or winding up of Popular.
The acquired shares of common stock were added back to treasury stock. 43 [2] As part of its capital plan, in July 2024, the Corporation announced plans to repurchase up to $500 million in common stock and repurchases began in August 2024.
The acquired shares of common stock were added back to treasury stock. [2] As part of its capital plan, in July 2025, the Corporation announced plans to repurchase up to $500 million in common stock, in addition to the $500 million in common stock repurchase program announced in July 2024.
The last sales price for the Common Stock on that date was $100.41 per share. 42 Preferred Stock Popular has 30,000,000 shares of authorized Preferred Stock that may be issued in one or more series, and the shares of each series shall have such rights and preferences as shall be fixed by the Board of Directors when authorizing the issuance of that particular series.
Preferred Stock Popular has 30,000,000 shares of authorized Preferred Stock that may be issued in one or more series, and the shares of each series shall have such rights and preferences as shall be fixed by the Board of Directors when authorizing the issuance of that particular series.
The Corporation’s planned common stock repurchases may be executed in open market transactions, privately negotiated transactions, block trades or any other manner determined by the Corporation.
At December 31, 2025, $281.2 million remained on our active common stock repurchase authorization. The Corporation’s planned common stock repurchases may be executed in open market transactions, privately negotiated transactions, block trades or any other manner determined by the Corporation.
As of December 31, 2024, the Corporation repurchased 2,256,420 shares of common stock for $217.3 million at an average price of $96.32 per share, under the previously announced share repurchase authorization. Equity Compensation Plans For information about our equity compensation plans, refer to Part III, Item 12.
As of December 31, 2025, the Corporation had repurchased 6,916,544 shares of common stock for $718.8 million at an average price of $103.92 per share, as part of the 2024 and 2025 common stock repurchase programs. Equity Compensation Plans For information about our equity compensation plans, refer to Part III, Item 12.
Purchases of Equity Securities The following table sets forth the details of purchases of Common Stock by the Corporation during the quarter ended December 31, 2024: Issuer Purchases of Equity Securities Not in thousands Period Total Number of Shares Purchased [1] Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs [2] Maximum Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs [2] October 1 – October 31 354,933 $96.23 353,811 $407,182,276 November 1 – November 30 549,290 95.60 549,290 354,669,382 December 1 – December 31 754,336 95.48 754,223 282,659,169 Total December 31, 2024 1,658,559 $95.68 1,657,324 $282,659,169 [1] Includes 1,122 and 113 shares of the Corporation's common stock acquired by the Corporation during October and December 2024, respectively, in connection with the satisfaction of tax withholding obligations on vested awards of restricted stock or restricted stock units granted to directors and certain employees under the Corporation’s Omnibus Incentive Plan.
Purchases of Equity Securities The following table sets forth the details of purchases of Common Stock by the Corporation during the quarter ended December 31, 2025: Issuer Purchases of Equity Securities Not in thousands Period Total Number of Shares Purchased [1] Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs [2] Maximum Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs [2] October 1 – October 31 232,575 $120.97 232,539 $400,794,897 November 1 – November 30 496,688 113.84 496,688 344,252,709 December 1 – December 31 523,147 120.78 523,076 281,075,956 Total December 31, 2025 1,252,410 $118.06 1,252,303 $281,075,956 [1] Includes 36 and 71 shares of the Corporation's common stock acquired by the Corporation during October and December 2025, respectively, in connection with the satisfaction of tax withholding obligations on vested awards of restricted stock or restricted stock units granted to directors and certain employees under the Corporation’s Omnibus Incentive Plan.
As of February 27, 2025, Popular had 6,100 stockholders of record of the Common Stock, not including beneficial owners whose shares are held in record names of brokers or other nominees.
Additional information concerning legal or regulatory restrictions on the payment of dividends by Popular, BPPR and PB is contained under the caption “Regulation and Supervision” in Item 1 herein. As of February 26, 2026, Popular had 5,721 stockholders of record of the Common Stock, not including beneficial owners whose shares are held in record names of brokers or other nominees.
Removed
On July 12, 2022, the Corporation completed an accelerated share repurchase (“ASR”) program for the repurchase of an aggregate $400 million of Popular’s common stock for which an initial delivery of 3,483,942 shares were delivered in March 2022 (the “March ASR Agreement”).
Added
The last sales price for the Common Stock on that date was $142.51 per share.
Removed
Upon the final settlement of the March ASR Agreement, the Corporation received an additional 1,582,922 shares of common stock. The Corporation repurchased a total of 5,066,864 shares at an average purchase price of $78.94, which were recorded as treasury stock by $440 million under the March ASR Agreement.
Removed
On December 7, 2022 the Corporation completed the settlement of another ASR Agreement for the repurchase of an aggregate $231 million of Popular’s common stock, for which an initial 2,339,241 shares were delivered on August 26, 2022 (the “August ASR Agreement”). Upon the final settlement of the ASR Agreement, the Corporation received an additional 840,024 shares of common stock.
Removed
The Corporation repurchased a total of 3,179,265 shares at an average purchase price of $72.66, which were recorded as treasury stock by $245 million under the August ASR Agreement. Additional information concerning legal or regulatory restrictions on the payment of dividends by Popular, BPPR and PB is contained under the caption “Regulation and Supervision” in Item 1 herein.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information regarding the market risk of our investments appears under the caption “Risk Management”, on page 80 within Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Form 10-K.
Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK The information regarding the market risk of our investments appears under the caption “Risk Management”, on page 79 within Management’s Discussion and Analysis of Financial Condition and Results of Operations in this Form 10-K.

Other BPOPM 10-K year-over-year comparisons