First BanCorp. reported net income of $24.2 million for the fourth quarter of 2017, or $0.11 per diluted share, compared to a net loss of $10.8 million, or $0.05 per diluted share, for the third quarter of 2017 and net income of $23.9 million, or $0.11 per diluted share, for the fourth quarter of 2016.
For the year ended Dec. 31, 2017, the corporation reported net income of $67 million, or $0.30 per diluted share, compared to $93.2 million, or $0.43 per diluted share, for the year ended Dec. 31, 2016.
“We are quite pleased with our results for the fourth quarter and fiscal year end 2017. Notwithstanding the uncertain macroeconomic backdrop in Puerto Rico, which was further affected by Hurricanes Irma and María in September, our institution continues to improve performance metrics and demonstrate the strength of its earnings capabilities,” said First BanCorp. President Aurelio Alemán.
In a call with analysts, Alemán also said because the recovery of the island’s electrical system has been slower than anticipated, it is still having an impact on business reopening on some of its borrowers, customers and employees.
“With regard to our branches, today, we’re operating with 94 percent of our branch network, 44 out of 47. Three of the branches were damaged and will be in the process of operating either the end of the month or the areas that are fully operational,” he said.
“It is important to highlight, that business activity did continue to improve month by month, December showing good improvement trend versus November. We look forward to that improving trend to continue over the next months as all service get back to normal,” he added.
Loan origination volumes in Puerto Rico and the U.S. Virgin Islands were affected by the hurricanes while the bank has experienced “steady growth in Florida,” which continues to support its balance sheet.
“For the year prior to the hurricanes impact, we were averaging more than $920 million in origination and renewal volume per quarter compared to an average $640 million over the past two quarters, we expect this to increase in the later part of 2018,” Alemán said.
During the fourth quarter, deposits net of government and brokered increased by $377 million; $247 million of this increase was noninterest-bearing deposits, mostly in Puerto Rico. First BanCorp.’s nonperforming assets increased by $9.9 million related to storm-impacted commercial credits.
Since Dec. 31, 2016, the bank has reduced nonperforming assets by $83.9 million.
“We will have a better sense of the impact of the storms on our borrowers following the moratorium in the first quarter. While we continue monitoring the impact of the storms on our economy and our customers, we remain confident that our participation in the rebuilding efforts in Puerto Rico will drive better results in 2018,” Alemán said.
The moratorium, he said has given bank customers a “nice cash cushion, which we’re seeing reflected into the deposit growth. Again, we’re seeing some insurance money flowing to the island, but not at the level we anticipate seeing in the coming quarters. Most of our $377 million in deposit growth was private customer deposits both in commercial and retail,” Alemán said.