First BanCorp. announced Monday that its subsidiary, FirstBank Puerto Rico, sold on March 10, 2017 its outstanding participation in a line of credit to the Puerto Rico Electric Power Authority (PREPA), reducing its direct exposure to Puerto Rico government related credits.
Gross proceeds from the sale have resulted in a slight incremental loss of approximately $570,000 as compared to the adjusted book balance, net of reserves, the bank said.
“We made the determination to prudently reduce our direct exposure to the Puerto Rico government,” said First BanCorp President Aurelio Alemán.
“This sale reduces our year end NPAs by approximately 9 percent. Credit quality improvement remains a top priority for our team and this transaction contributes to our continuing efforts,” he added.
As of Dec. 31, 2016, First BanCorp had a direct exposure to PREPA with a loan with a book value of $65.5 million.