BankingFinancial District

Doral reports $2.6M in 1Q earnings, $101.5M increase in Tier 1 capital

Doral Financial Corp. has operations on the U.S. mainland and Puerto Rico, where it is headquartered in Hato Rey. (Credit: © Mauricio Pascual)

Doral Financial Corp., Doral Bank’s parent company, reported net income of $2.6 million for the quarter ended Mar. 31, which while reflecting a 21.2 percent drop in comparison to the $3.3 million reported for the same year-ago quarter, CEO Glen Wakeman said the company is on a “solid course.”

His comments addressed the result of an agreement Doral reached with the Treasury Department through which it generated a tax benefit of $112.6 million for the first quarter. The moved increased Tier 1 capital by $101.5 million from Dec. 31, 2011 to $822.9 million.

The Tier 1 leverage ratio increased by 106 basis points from Dec. 31, 2011 to 10.19 percent, he said.

“Doral is on a solid course. Additional capital and reserves strengthened our balance sheet considerably. Our leading mortgage and retail franchise in Puerto Rico provides a strong foundation, while U.S. asset growth and liability management are expanding margins and profitability,” said Wakeman.

Still, the net income reported for the current quarter dropped significantly from the $11.7 million reported for the quarter ended Dec. 31, 2011.

During the first quarter, Doral incurred in $115.2 million in provision for loan and lease losses and adopted a more conservative outlook in line with the “uncertain economic and regulatory environments.” The bank also increased its net interest income $2.7 million to $52.1 million in the first quarter of 2012 from $49.4 million in the fourth quarter of 2011

In the areas of loans and deposits, the bank increased both segments, reporting net growth in total loans, by $49.8 million from the fourth quarter of 2011 to the first quarter of 2012, and a growth in retail deposits by $87.6 million during the same period, which was driven by the growth in U.S. sourced deposits.

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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