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Banco Popular receives 127K applications for loan moratoriums

Banco Popular de Puerto Rico has received a total of 127,000 moratorium applications, split between auto, personal and mortgage loans, Popular Inc. CEO Ignacio Álvarez confirmed.

Of that number, 100,000 are in its own portfolio, and the remaining 27,000 are mortgage loans owned by third-parties such as Fannie Mae, Freddie Mac and the Federal Housing Administration that the financial institution services.

During a conference call with members of Puerto Rico’s media, Álvarez said the bank has processed 68% of the applications, saying the call volume has stabilized following several busy weeks after the island went into lockdown mode on Mar. 16.

He broke down the applications by category, saying applications for auto loan moratoriums reached 50,786 or 25% of the bank’s portfolio. Commercial loans reached 3,646, or 17% of the bank’s portfolio. With regards to mortgage loans, the bank received 11,941 applications, or 23% of Popular total portfolio.

As for credit card and personal loans, Álvarez said Popular has fielded 34,666 applications, representing 6% of the bank’s portfolio. There was no breakdown for the 27,000 third-party loans to specify how many belong to which lender.

On Thursday, Popular Inc. reported net income of $34.3 million in the first quarter of 2020 that ended Mar. 31, compared to net income of $166.8 million in the fourth quarter of 2019. The first quarter results “reflect the impact of the adoption of the Current Expected Credit Losses (“CECL”) accounting standard,” he said.

Regarding the U.S. Small Business Administration’s Paycheck Protection Program initiative, Popular has submitted more than $1.2 billion in loans, representing more than 15,000 small and medium sized businesses on the island.

So far, the federal agency has approved more than $819 million of that amount, he said.

“We’ve dedicated a lot of time to the PPP program. The first round was complicated, the rules changed, the system was difficult to learn, but we learned and now it’s going well,” he said, noting the majority of the local loans will be for less than $150,000, but the average will be $75,000.

“So, we’re reaching many small businesses. Most of the people who apply will get the loan if they’re eligible. The money is being managed better,” he said.

As for how it is handling the COVID-19 emergency, Popular is operating 122 branches in Puerto Rico — during limited hours and mostly through drive-up windows — seven in the U.S. Virgin Islands, and 11 in South Florida.
The bank has waived or refunding certain fees, temporarily halted foreclosures and is not reporting payment deferrals to credit bureaus.

“We have also pledged more than $1 million dollars in support of COVID-19 emergency relief to nonprofit organizations and health providers. I am deeply grateful to our colleagues for the efforts, commitment, and bravery exhibited under very difficult circumstances,” Álvarez said.

Author Details
Business reporter with 25 years of experience writing for weekly and daily newspapers, as well as trade publications in Puerto Rico. My list of former employers includes Caribbean Business, The San Juan Star, and the Puerto Rico Daily Sun, among others. My areas of expertise include telecommunications, technology, retail, agriculture, tourism, banking and most other areas of the economy.

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