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OFG Bancorp earns $46M; CEO says one of best 1Q in a long time

OFG Bancorp, the financial holding company for Oriental Bank, reported results for the first quarter ended March 31 that showed core revenues of $164.4 million compared to the $168.3 million reported in the same quarter in 2022.

This translates into a diluted earnings per share of $0.96 during the recently ended quarter, compared to $0.97 in the same year-ago period, according to the earnings results.

“The first quarter continued to reflect high levels of liquidity and capital, putting OFG in a strong position in today’s banking environment,” OFG CEO José Rafael Fernández said. “Our financial results also demonstrated solid core revenues, net interest margin, credit quality, operating leverage, and customer acquisition trends.”

“The first quarter was one of the best first quarters we’ve had in a long time and the results have been extraordinary,” he said, adding all the bank’s business lines showed growth.

Customer deposits for the quarter stood at of $8.57 billion compared to $8.56 billion in the second quarter of 2002.

“We’re seeing an ongoing improvement, and Puerto Rican clients, our customers, are very well-positioned from the standpoint of their liquidity, as well as businesses. Our delinquency rates have been very low. We’re operating with important capital levels, which puts us in very positive position,” Fernández said during a call with Puerto Rico-based business reporters.

He attributed the positive results to infrastructure projects and Puerto Rico’s improved economy, as well as investments made in technology during the quarter.

“We continued to execute our ‘digital first’ strategy, placing more banking kiosks and interactive teller machines in the field, and client digital adoption increased 10% year-over-year,” Fernández said.

“With Puerto Rico businesses and consumers remaining in good financial health, we look forward to ongoing progress in 2023. Thanks to our team for their excellent execution, dedication and drive in helping customers and the communities we serve to achieve their financial goals,” he added.

In the first quarter of 2023, OFG reported a net interest margin of 5.89%, a return on average assets of 1.87%, a return on average tangible common stockholders’ equity of 19.13%, and an efficiency ratio of 54.87%.

Net interest income amounted to $135.9 million, compared to $135.3 million in the fourth quarter of 2022 and $105.2 million in the first quarter of last year.

“The first quarter of 2023 reflected the full effect of the fourth quarter 2022’s 50 basis point increase in the federal funds rate and the partial effect of the first quarter 2023’s 50 bps increase. Two fewer days compared to the fourth quarter of 2022, reduced Net Interest Income by $2.2 million,” the bank stated.

The financial institution reported interest income of $149 million, compared to $145.7 million in the fourth quarter of 2022 and $112.9 million in the first quarter that year. The bank noted that the first quarter of 2023 saw “higher yields on increased average loans,” particularly in the auto, commercial and consumer sectors, when compared to the fourth quarter of 2022.

Author Details
Author Details
Business reporter with 30 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 segments of Puerto Rico’s economy.

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