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.